People with problem debt may be given a six-week breathing space, under plans put forward by the government.
The period would exempt those affected from further interest, charges and enforcement action in order to give them a chance to seek advice.
The government is seeking views on the plans, which were first announced in this year’s manifesto.
It says that although many people manage credit successfully, millions of people are struggling with debts.
The government says that causes of debt can range from the sudden loss of employment to a more gradual dependence on debt to make ends meet, with many people waiting 12 months or more before seeking help.
The Conservative manifesto also talked about introducing a “statutory repayment plan”.
It will meet key industry representatives from charities, debt advice organisations, lenders and creditors in order to gather views. Members of the public, particularly those affected by the issue, are also being asked for their views.
The government is aiming to have a draft bill ready by the end of next year, or by 2019 at the latest.
The Economic Secretary to the Treasury, Stephen Barclay, said: “For many people in the UK problem debt seems impossible to escape. Its effects can be far-reaching, impacting all aspects of a person’s life and leaving them feeling helpless.
“That is why we are working to give people who are overwhelmed by debt, more time to seek advice, find a workable solution, and help get their lives back on track.”
Campaigners have been arguing for a grace period for debtors.
Later on Tuesday, the House of Lords will debate the Financial Guidance and Claims bill, which it wants amended to include the breathing space now.