Personal insolvencies fall by 6.4%

Latest quarterly figures from the Insolvency Service for England & Wales have indicated that personal insolvencies numbers decreased by 6.4% to 9,824 in June 2022 compared to 10,497 in May, and were 0.3% lower than June 2021’s figure of 9,852.

For individuals, 471 bankruptcies were registered, which was 37% lower than in June 2021 and 64% lower than June 2019.

The bankruptcies were made up of 401 debtor applications and 70 creditor petitions. Monthly bankruptcy numbers between July 2021 and June 2022 were lower than There were, on average, 7,575 IVAs registered per month in the three-month period ending June 2022, 6% higher than for the three-month period ending June 2021 and 17% higher than the three-months ending June 2019.

There were 1,815 Debt Relief Orders (DROs) in June 2022, which was 28% higher than in June 2021 but 14% lower than the pre-pandemic comparison month (June 2019).

In June 2022 there were 5,772 breathing space registrations. This is 2% higher than the number in June 2021. There were 5,772 Breathing Space registrations in June 2022, which is 2% higher than the number registered in June 2021. 5,687 were Standard breathing space registrations, which is 2% higher than in June 2021, and 85 were Mental Health breathing space registrations, which is 35% higher than the number in June 2021. There were 85 Mental Health breathing space registrations, which is 35% higher than the number in June 2021.

Commenting on the figures Nicky Fisher, Vice President of R3, said “The monthly and yearly fall in numbers has been driven by a reduction in all forms of personal insolvency process.

“Despite this, times are still tough for people in England and Wales. We often talk about putting money away for a rainy day but with a rise in costs across the board from food to fuel and even rent, for many people that rainy day has arrived. And for some, it’s likely to appear soon.”

“With wages struggling to keep up with inflation, a significant number of people simply have nothing left to spare from their pay packet once the bills have been paid. But we’re also seeing many people having to dip into their savings and use credit cards to pay for just the essentials, with some reducing their workplace pension contributions to provide some additional financial elbow room.”

“While individuals across the board are feeling the effects of the rising cost of living, those on lower incomes are most severely affected and it is those people that are most vulnerable to becoming insolvent.”