In response to a worrying increase in requests for help, Moneylife Foundation has launched a new online credit counselling service to provide early-stage guidance to individuals facing personal debt distress. The initiative is accessible to people across India and offers one-time, initial guidance to help borrowers understand their financial position and explore a possible path to resolution.
The sessions are anchored by Aparna Ramachandra, founder-director of Rectify Credit, who has generously agreed to donate her time and expertise to the Foundation’s efforts. While the guidance provided is professional and structured, participants are expected to take the next steps on their own or seek further help from qualified professionals. At present, Moneylife Foundation does not have the resources to provide hand-holding or long-term support beyond this one-time intervention.
Over the past several months, Moneylife has observed a worrying trend—an increasing number of emails, messages and distress calls from individuals struggling under the burden of personal debt. Some are dealing with multiple personal loans, some have maxed-out credit cards and many have borrowed from digital lending apps that charge exorbitant interest rates. In several cases, the total loan obligations far exceed the borrower’s monthly income. This kind of financial stress not only causes monetary instability, it also affects people’s mental health, their families and their futures.
The counselling clinic, now two sessions in, provides free, one-time guidance to participants who are required to submit their credit reports, financial documents and a summary of their income and dues in advance. The idea is to make each session focused and productive, offering direction on how to prioritise repayments, manage defaults and approach lenders for settlements where necessary.
Participants in the first two sessions have included salaried professionals, small business owners and individuals with stable incomes who, nonetheless, find themselves in deep financial trouble. In many cases, the debt burden has ballooned due to a combination of factors—such as helping friends or family in emergencies, business losses, dubious online investments or unexpected medical expenses. Some individuals also reported having paid fees to dubious debt advisory services that offered little to no actual support.
While each case is unique, certain patterns have emerged: borrowing to repay earlier loans, app-based credit with high interest rates, lack of savings and growing emotional distress. Many participants admitted to being unaware of the long-term consequences of missed payments or settlements on their credit scores. Others appeared to be in denial about the severity of their situation, expecting large inflows of money from uncertain sources.
Debt is not just a financial issue, as it can severely affect one’s mental health, decision-making and even personal relationships. During the counselling sessions, it became clear that some individuals were struggling not just with numbers, but with fear, denial, anxiety and even depression.
One particularly concerning case involved a government-employed medical doctor, whose financial troubles began after she and her husband took a business loan. When the business failed, she began borrowing from other sources to repay the original debt—an unfortunately common pattern. By the time she sought help, she had accumulated crores in outstanding dues across multiple financial institutions, including personal and business loans, a car loan, bank overdrafts, app-based loans and credit cards. Her monthly obligations including household expenses, were more than double her income.
Though sincere in her desire to repay, she appeared overwhelmed and unaware of the full impact of her borrowing. Ms Ramachandra advised her to focus on paying off the high-interest app loans and credit card dues. With no savings or investments to fall back on, she also encouraged her to consider temporary support from her close relatives or family members. More importantly, she warned against taking any further loans—both to protect her own creditworthiness and that of her children, who might someday apply for education loans. With careful planning and a structured approach, Ms Ramachandra said, it was still possible to bring her EMI (equated monthly instalment) burden under control within six months.
She emphasises that while the debt burden is often severe, it is possible to reduce the impact with a structured plan and a willingness to act. The focus of these sessions is not to offer moral judgement, but to provide clarity. The aim is to help individuals understand their financial position, assess available options and identify practical steps to regain control of their situation.
However, these sessions are not designed for long-term support or restructuring services. The counselling clinic provides a one-time assessment and direction; further help, if required, would need to be sought independently. It is also important for participants to be completely honest when seeking financial counselling. Sharing incomplete or misleading information, whether out of fear or shame, only hinders recovery. Participants are also expected to treat appointments seriously, as the service involves the time of a qualified expert and significant backend coordination.
Moneylife Foundation’s credit counselling sessions are held online on a fortnightly basis, Fridays between 4-6pm. Those interested in booking a slot for upcoming sessions can seek an appointment by calling the Foundation - 022-35131664 or (022) 35036925, or by sending an email to [email protected]. Appointments are allotted on a first-come, first-served basis, subject to submission of required documents.
