Published 14:36 IST, January 19th 2020
Amsterdam to wipe out young people's debt to give them a 'new start'
Amsterdam is reportedly clearing out young people's debt to free them from the stresses of financial pressure in a fresh move to help people have a fresh start.
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Amsterdam, the capital city of the Netherlands is clearing out young people's debt to free them from the stresses of being under financial pressure in a fresh move to help people who struggle hard to get into work or education. The move follows a rise in the number of young adults in the Netherlands and other parts of Europe including the UK who are debt-ridden.
Conducted on a trial basis, the municipal credit bank has decided to start talks with creditors to buy the debts from them. The people who get involved with the scheme will be then provided with a loan to repay within their means.
Incentive to the creditors
Creditors will also be given an incentive of €750 to pass debts onto the municipality's bank while its youth will be given an opportunity for more of their debt to be cancelled if they go on to training or educational courses. Marjolein Moorman, deputy mayor of Amsterdam, said debt increases stress levels and added that in the case of young people, debts often determine their future. She added that a lot of young people started out in arrears and due to their bad luck or ignorance, they found themselves in a situation where they could not get out without any help. She said that is the reason Amsterdam is going to help them so that they can have a fresh start.
New move to kick-off in February
The new move is all set to kick off in February and the debt transfer project will give each person a coach for further guidance who participates in the trial. The city said it is difficult for young people who have who don't have a stable income to get on top of their finances to keep up with repayments. One-third of people within the age group of 18 and 34 have debts in Amsterdam, with the average student debt now reaching €13,700 (£11,700 / $15,200). The amount of individuals with student debt has seen a sharp growth by 388,000 reaching 1.4 million.
14:36 IST, January 19th 2020