Credit, Collections & Insolvency News
Latest quarterly figures from the Insolvency Service for England & Wales have indicated that personal insolvency numbers increased slightly.
After seasonal adjustment, the number of personal insolvencies in Quarter 4 2022 was 6% higher than Quarter 3 2022, and 7% higher than in Quarter 4 2021.
During the final Quarter of 2022, there were 29,589 personal insolvencies.
The insolvencies comprised of 21,865 Individual Voluntary Arrangements (IVAs), 74%, 6,142 Debt Relief Orders (DROs), 21% and 1,582 bankruptcies, 5%.
The number of bankruptcies registered decreased by 8% when compared to the previous quarter and by 14% from the same quarter last year. The number of bankruptcies was the lowest since Quarter 4 1982.
The bankruptcies consisted of 1,308 debtors’ applications, which was 8% lower than Q3 2022 and 16% lower than Q4 2021,263 creditors’ petitions, which was 12% lower than Q3 2022 and 4% lower than Quarter 4 2021.
Whilst the number of DROs in Q4 2022 was 10% higher than the previous Quarter, and was 5% higher than the same quarter last year.
Commenting on the latest figures, Andy Nalliah, Personal Onsolvency Partner at RSM UK, “The rise in interest rates and the costs of living show little sign of slowing and for debtors whose discretionary funds are already depleted and whose savings are exhausted, the risk of failing to service their ongoing costs and expenses together with any IVA commitments remains very real and may only increase.”
“The downward trend of the last two years continued for bankruptcy numbers. I expect they are likely to remain low for the next few months as many debtors will endeavour to reach agreement with their creditors to avoid bankruptcy, and those with minimal assets can also avoid the bankruptcy process if they qualify for and enter a DRO.”
