Debt Free Direct, one of the UK’s biggest bad debt companies, has forecast a huge surge in profits this year, throwing light on the plight of those thousands of people laden with credit card and other outstanding bills who make up its customer base.

The Aim-listed company, which rearranges debt payments and drafts individual voluntary arrangements (IVAs), said it expected to beat profit forecasts of £9.8m by at least 10%.

IVAs allow people to repay a set amount each month in exchange for creditors freezing interest payments on the debt.