The government will review the scheme after four months

MSPs approved the move amid concerns that it could open the floodgates for those looking for an easy way to get rid of debt.

The regulations will apply to those on the minimum wage and with assets of less than �10,000.

Ministers promised a review of the arrangement after four months.

As many as 5,000 debtors need urgent relief offered by the scheme, according to Citizens Advice Scotland.

'Credit morass'

It aims to help those who have large debts but cannot be declared bankrupt because there are no court proceedings against them.

This can leave debtors trapped, with no prospect of repaying their debts and no prospect of debt relief.

The new route into bankruptcy will allow them to register with the official Accountant in Bankruptcy and have their financial problems addressed.

Holyrood's Justice Committee backed the regulations but MSPs expressed concern that students could use them to pay off their debts.