When creditors threaten to take legal action against people who haven't repaid their debts, they have the backing of a legal system that can still imprison people for such non-payment.
The first document the debtor will receive is a court summons containing a date for a hearing if the debtor wants to defend the case.
By not defending the case, the debtor is admitting to owing the amount. A judgment is given against the debtor, who is legally obliged to pay the total stated on the decree. The creditors can continue charging interest, but only at a rate of 8 per cent.
Creditors can register the judgment, which means the debtor's name and the nature of the debt will appear in Stubbs Gazette and will be a public record in the court office.
Goods belonging to the debtor can also be seized by the county sheriff, while a judgment order can be put on a property, so that it becomes a guarantee that the debt will be paid.
The court decides how much the debtor has to pay in regular instalments. Debtors will get a summons to attend a court hearing at which they must outline their means. It is extremely important to attend the court, the Money Advice and Budgeting Service (Mabs) warns, as otherwise the judge will make a decision without hearing about the debtor's capability to pay.
If the instalment order is not kept, the creditor can apply to the courts for a committal summons. If the debtor attends and explains why they didn't pay, the judge may vary the instalment order.
But if the debtor does not attend, the judge will make a committal order, ordering the debtor to be sent to prison - technically, it will be for contempt of court.
"The legal process for dealing with consumer debt belongs to the time of Dickens, really. We still have people going to prison for non-payment of debts," says Mabs spokesman Michael Culloty.
"A person might have 15 creditors and each one of them could independently take the person to court, but the judge doesn't know about the other 14 creditors. Often people don't show up, particularly in rural areas, because it means washing their linen publicly."
A pilot out-of-court debt settlement scheme run by the Irish Banking Federation (IBF) in conjunction with Mabs two years ago is still being evaluated.
In a report published in 2003, the Free Legal Advice Centres (Flac) called for an "early warning" system for cases of chronic indebtedness, recommending that an independent arbitrator be set up to adjudicate on settlements.
But since then, there have been no moves to change the current system, says report author Paul Joyce. "All people have done is borrow like they were encouraged to do. I think people should be treated humanely."
