Personal insolvencies figures fall by 21.4%

Latest quarterly figures from the Insolvency Service for England & Wales have indicated that personal insolvency numbers decreased by 21.4% in April 2023  to a total of 8,996 compared to March’s total of 11,447, and decreased by 8.1% compared to April 2022’s figure of 9,790.

Personal insolvencies also decreased by 8.9% when compared to April 2021’s total of 9,873 and decreased by 7.1% from pre-pandemic levels in April 2019 (9,685).

There were 531 bankruptcies registered, which was 5% lower than in April 2022, and less than half of pre-2020 levels.

The bankruptcies were made up of 418 debtor applications and 113 creditor petitions. Over the past year there has been an average of 562 bankruptcies per month, 60% lower than the 2019 (pre-pandemic) average of 1,395. Debtor applications were 10% lower but creditor petitions were 18% higher than April 2022.

There were 2,384 Debt Relief Orders (DROs) in April 2023, which was 24% higher than April 2022. Monthly DRO numbers may be volatile at present due to the introduction of new DRO hubs.

There were, on average, 6,336 Individual Voluntary Arrangements (IVAs) registered per month in the three-month period ending April 2023, which is 16% lower than the three-month period ending April 2022. IVA numbers so far in 2023 have been lower than 2022, which had a record high annual number of IVAs.

In April 2023 there were 6,613 breathing space registrations. This is 23% higher than the number in April 2022.

Of the 6,613 Breathing Space registrations in April 2023 there were 6,485 Standard breathing space registrations, which is 23% higher than the number in April 2022. There were also 128 Mental Health breathing space registrations, which is 21% higher than the number in April 2022.

Nicky Fisher, President of R3, said “When it comes to personal insolvencies, the monthly and yearly drop in the figures we’ve seen today has been driven by a reduction in numbers for all forms of personal insolvency process, but notably in Individual Voluntary Arrangements (IVAs) and Debt Relief Orders (DROs).”

“However, we must treat the fall we’ve seen in the personal insolvency figures published today with some caution as they will reflect a changing debt solutions market where options for individuals might not be as readily available as they might be, and there could be a backlog of cases building up as a result.”

“Money worries remain a key concern for many people across England and Wales. The costs of energy and food remain a serious challenge, people are borrowing more and more as they attempt to cover their expenses, and are cautious about spending money on anything that isn’t essential.”