Debt collection agencies don't usually rush into making people bankrupt. That's got nothing to do with any goodwill on their part; it's simply that they'll make more money, in the long term, from accepting small regular payments.
Contact the agency, a.s.a.p. Also contact a debt support service, but please take care - there are plenty of commercial firms who pose as independent debt counselling services. You require a genuinely independent organisation. I can recommend CCCS, which is an independent charity:
http://www.cccs.co.uk/contact/contact.aspx
If a Statutory Demand is issued, you will have 18 days to repay the debt (which, obviously, you can't) or to persuade 1st Credit (or their debt collection agency) to accept a repayment arrangement. Beyond that time, a petition for your bankruptcy can be issued (but it doesn't automatically follow that the lender, or their agents, will choose to take that path).
You've not stated whether your �40 arrangement was voluntary or as the the result of a County Court Judgement. A court would be unlikely to make you bankrupt unless it could be shown that you'd failed to comply with a CCJ or that you'd never be able to repay the debt.
Chris