Token payments are a low arrangement offered to a creditor. It can be anything from £1 a month to show that you want to repay the debt.
Token payments will not resolve your debt problems, so it is important to work towards a long-term solution.
You should send a copy of your financial statement with a holding letter to ask your creditor to suspend interest and other charges so that your debt does not increase. They can refuse.
Sample letters
You can find templates for sample letters to creditors on Citizens Advice.
Advantages
Sometimes token payment is the only way for a creditor to agree to hold interest and charges and prevent recovery action.
You are paying something towards the debt while you are looking into long-term solutions.
The creditor may agree to take no further action while token payments are being made
Disadvantages
Token payments use money you may struggle to find.
There may be costs involved in making payments. Consider using standing orders or Direct Debits.
It may affect your credit rating.
It does not repay your debts.