BusinessBusiness RecoveryPersonal insolvencies climb 60% in one year

Personal insolvencies climb 60% in one year

New quarterly and yearly figures analysed by Grant Thornton

Personal
insolvencies
touched the 30,000 mark in the final quarter of 2006, according
to figures issued by the Insolvency
Service
and analysed by Grant Thornton’s recovery & reorganisation
practice.

For the year insolvencies reached 107,288 up almost 60% from the previous
year’s figure of 67,584.

The firm said the figures showed that
IVAs
were catching up with bankruptcies to become the insolvency procedure of choice
for resolving serious debt issues – there were 12,741 IVAs for the fourth
quarter compared to bankruptcies, which numbered 17,063.

Mike Gerrard, Grant Thornton’s head of personal insolvency, said, ‘Rising
personal insolvencies are, in the most part, fuelled by consumers who borrow to
spend, struggle to repay what they’ve borrowed and then quickly find themselves
caught out in a spiral of debt they can’t escape from. The problem is at such a
serious level that almost 300 people are becoming insolvent each day.’

Further reading:

Treasury promises to improve financial literacy

New insolvency qualification to deliver IVA specialists


Insolvencies rocket in 2006

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