Monday 06 July 2020

Amsterdam launches scheme to help youngsters clear their debts

Euro coins


Amsterdam city council is launching a pilot scheme to help a group of young people to clear their debts in exchange for a commitment to work or study, the Parool reported on Tuesday.

Some 20,000 people between the ages of 18 and 27 have ‘problematic’ debts, meaning they are unable to pay them off within three years, the paper said.

Alderman Marjolein Moorman said the debts are holding youngsters back and making it even harder for them to find a place to live. Youngsters with debts also tend to give up their studies prematurely, Moorman said in a letter to councillors.

The scheme is similar to one already in place in The Hague and Utrecht. It involves transfering the debts of selected young people to the council credit bank and a €750 contribution towards paying off the debt.

In return for the council’s help, the youngsters will have to commit to a plan involving finishing their education or finding a job.

If the council can persuade creditors to agree to the debt transfer, some 150 youngsters will be able to make a fresh start his year, costing some €350,000, the paper said.

Debt expert Nadja Jungmann said the plan is a good one and could avoid future costs. ‘Research shows that people in debt often need much more care and are dependent on benefits for longer,’ she said.

The crucial thing is however is to give youngsters a say in the goals they have to achieve in exchange. ‘It has to be something meaningful to them or it won’t work.’

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