Credit, Collections & Insolvency News
Latest monthly figures from the Insolvency Service for England & Wales have indicated that personal insolvencies decreased by 0.6% to 10,465 in November 2022 compared to 10,528 in October, but were 11.4% higher than November 2021’s figure of 9,390, and 8.9% from November 2019’s total of 9,606.
There were 2,269 DROs which was 10% higher than in November 2021 but 4% lower than the pre-pandemic comparison month (November 2019). There were, on average, 7,801 Individual Voluntary Arrangements (IVAs) registered per month, which is 11% higher than the three-month period ending November 2021, and 14% higher than the three-month period ending November 2019. IVA numbers have ranged from around 6,300 to 7,800 per month over the past year.
There were 546 bankruptcies which were 16% lower than in November 2021 and 60% lower than November 2019. The bankruptcies were made up of 445 debtor applications and 101 creditor petitions. Monthly bankruptcy numbers over the past year were lower than the numbers in 2020, which were already lower than pre-pandemic levels.
Compared to November 2019, total bankruptcies were 60% lower; debtor applications were 61% lower and creditor petitions were 56% lower.
There were 6,796 Breathing Space registrations, which is 40% higher than the number registered in November 2021. 6,689 were Standard breathing space registrations, which is 40% higher than in November 2021, and 107 were Mental Health breathing space registrations, which is 19% higher than the number in November 2021.
Commenting on the figures, Christina Fitzgerald, President of R3 said “The monthly reduction in personal insolvencies has been driven by a drop in Individual Voluntary Arrangement numbers. However, numbers for this process are higher than last year and in 2019, as are Debt Relief Order numbers.
“This suggests that while more people entering an insolvency process than last year and three years ago, they’re able to enter ones which allow them to work with their creditors to resolve their debts, rather than a bankruptcy.”
“There’s no doubt that rising costs and economic turbulence are taking their toll on personal finances. People are having to pay more to put food on the table, heat their homes and fuel their cars, and have little room to spend on anything other than the basics.”
“An increasing number are worried about money, with the cost of living and the price of energy their biggest concerns, and more people are turning to credit to pay for their day-to-day expenses.”
“Using credit as a solution can become a problem if people find themselves unable to pay their debts back or have to keep borrowing, and the amount they owe becomes unmanageable.”
“Our message to anyone worried about money or worried about their business is: seek advice as early as possible. While it’s incredibly hard to voice your fears about your finances or about a business which you own or run, having that conversation with a qualified advisor when your worries are new will lead to better outcomes than if you’d waited until your problems became more severe.”
