Melanie Giles, a leading insolvency practitioner, who has worked in the industry for over two decades, said that IVAs are something which consumers have become more aware of thanks to the media.
“The reason why there are so many IVAs at the moment is because banks are agreeing to them and accepting them. I think they are a workable solution,” she said.
“They are an option but we mustn’t be advising people that they are the only option.”
Commenting on recent reports about the ethics of debt consolidation firms, Ms Giles stressed that she does not believe there has been any mis-selling of IVAs.
Official figures show that show there were 29,804 individual insolvencies in final of 2006 – an increase of 44 per cent on 2005 – is a sign that a “significant number” of Brits are in a “very vulnerable position”, according to leading economist Howard Archer.