Croatia cancels debts of its 60,000 poorest citizens

Croatia has reportedly elected to erase the debts of thousands of its poorest citizens in an attempt to reinvigorate the economy.

The scheme, dubbed “fresh start”, intends to wipe debts owed to banks, telecoms and utilities companies on behalf of 60,000 citizens, the UK Telegraph reports.

A qualifying household’s overall debt must not exceed 35,000 kuna (A$6612) and their monthly income must not be higher than 1250 kuna (A$236).

The strategy aims to help some of the roughly 317,000 citizens who cannot access their bank accounts because of their outstanding debts.

The move comes as growth predictions for Croatia’s economy remain low, after six consecutive years of recession, The Washington Post reports.

The scheme commenced this week.