Debtors are facing a tough 2008 as the cost of living increases and their Christmas spending hits home but for Britain’s debt collection industry, business is booming.

Robert Verkaik, legal commentator for the Independent, explained that since 2003, the industry has almost tripled.

"The first contact with a debt collection agency is usually a bright red envelope in the post. The second is a late-night phone call informing the debtor of the agency’s involvement. And the third is the dreaded knock on the door," he commented.

Financial advice charity Credit Action urges debtors not to feel "pressured, bullied or threatened" into paying more than they can afford, even if a debt collector calls.

It reminds them that such collectors cannot legally enter debtors’ homes and that "undue harassment" is illegal.

One option for those concerned about debt collectors is to approach a debt management firm which can deal with creditors on their behalf.

If a debtor enters into an individual voluntary arrangement (IVA) then their creditors can no longer chase them as long as they keep to the new payment plan.