Debt relief refers to partial or total forgiveness of a debt. It also refers to the slowing or stopping the growth of a debt owed by individuals, corporations or even nations. This type of debt has been at times a source of controversy with some people opposed to it. Some people have termed it a blank cheque to governments. The main concern has always been that the savings will never reach the poor in countries where governments are corrupt. The opponents also argue that countries that have been given a relief normally take advantage and go ahead to contract other debts with the hope that the same debts will be forgiven.

Corrupt officials in various governments use the debt relief to amass wealth for themselves as well invest in rich countries denying the common man the trickle-down effect. According to the proponents, the money would rather be spend on aid projects in the various countries. Others also detest the conditions that come with the relief.

Heavily Indebted Poor Countries (HIPC) was set up to provide relief to the poorest countries while at the same time trying to ensure that the money is spent on poverty reduction in these very countries.

Recently, there has been an increase in personal debt. This has led to the rise of debt consolidation companies in an effort to offer personal debt relief. Although these companies step in to offer some kind of relief, some people are compelled to contract the services of such companies to escape situations like bankruptcy. Such arrangements may involve taking a secured loan using a debtor’s home, car or any other valuable property as collateral.