What is a Debt Management Plan?

A Debt Management Plan or DMP is a payment strategy agreed between you and your creditors. It enables you to pay back non-priority debts such as credit cards in a manageable way.

Normally, the Debt Management Plan is managed by an agency or DMP provider, so you don’t have to deal directly with companies you owe money to. You pay your DMP provider an agreed amount each month and they then divide it between your creditors.

What kind of debts can be paid off with a DMP?

Debt Management Plans aren’t much help if you’re late with your mortgage, rent or council tax. They can only be applied to debts that are considered ‘non-priority’. Non-priority debts might include:

  • Credit cards.
  • Store cards.
  • Personal loans like payday loans or finance agreements.

There are several different types of DMP to choose from and there are several non-profit agencies which can give you free advice and assistance. If you decide that a Debt Management Plan is right for you, the one you choose should help you to consolidate your payments and pay off your debt in a reasonable period.


*Disclaimer & Example: For our Small Loans of $2,000 or less, an APR (Annual Percentage Rate) doesn't apply. These loans are fee-based only with a term between 62 and 180 days, and so the APR is 0%. The establishment fee is 20% of the amount borrowed and the monthly fee is 4% of the amount borrowed. Representative example: a loan of $1,000 repaid over 3 months equates to a total amount payable of $1,320 comprised of $1,000 principal (amount borrowed), $200 establishment fee and $120 in monthly fees. The maximum comparison rate on loans between $300 and $2000 is 199.43%.
For our Medium Loans between $2,100 and $5,000, with a term between 2 months and 12 months, the maximum Annual Percentage Rate (APR) is 48% (Comparison rate 65.6597% p.a.) and there is a $400 Establishment Fee. A Medium Loan of $3,000 borrowed over 1 year would equate to a total amount payable of $4,289 (including a $400 establishment fee).

Under the current legislation, most small personal loan providers don’t charge an annual interest rate (you’ll know this as an APR %). The maximum you will be charged is a flat 20% Establishment Fee and a flat 4% Monthly Fee. The maximum comparison rate on loans between $300 and $2000 is 199.43%. This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

© 2023 Owned by Australian Synergy Finance Pty Ltd, ABN 54 613 655 646. Australian Credit Licence 490422. The information on this webpage is general information only and does not take into account your objectives, financial situation or needs.