SCOTLAND’S insolvency agency is to take a more lenient approach to gig economy workers unable to repay their debts because of coronavirus.
The Accountant in Bankruptcy (AiB) said it expected the pandemic to “exacerbate issues faced by those with fluctuating earnings, with those on zero hours contracts particularly impacted”.
As a result it would not revoke Debt Arrangement Schemes if people failed to make payments due to “a causal link to Covid-19 until further notice”.
The AiB said it had also suspended property sales and evictions in bankruptcy cases where it was the trustee.
It will also simplify procedures to help those seeking debt relief through bankruptcy, or need more time to pay debts through the Debt Arrangement Scheme.
This should alleviate the administrative burden on frontline money advisers and insolvency practitioners.
Other measures include a “pragmatic approach” to meeting statutory timescales and accepting electronic signatures on Protected Trust Deeds.
The AiB, which deals with around 80 per cent of bankruptcy cases in Scotland, urged other trustees to show similar leniency and flexibility.
SNP business minister Jamie Hepburn said: “This pandemic will have severe economic consequences and we are treating it as an economic emergency, affecting everyone from the largest conglomerates to small businesses and individuals.
“The Scottish Government is working hard to respond to this and we’ve announced a £2.2 billion package of measures to support businesses.
“We’re asking banks, insurance companies and our departments to be flexible and compassionate wherever possible, including offering mortgage holidays and extending timescales for those in persistent credit card debt.
“This will help reduce the pressure on individuals facing financial difficulties caused or made worse by the current crisis, and we are actively considering what more we can do to help.”
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