Industry Topic - 2012 Q4 Insolvency Service Statistics

R3, the trade body for Insolvency Professionals, recently commented on the above statistics. The statistics provide an interesting insight into the current climate and give us much food for thought. There is clearly still some way to go for the economy to instil confidence........

R3 say, "Total individual insolvencies in 2012 are down 8% from 2011 figures, while bankruptcy orders have fallen 24% year on year which is encouraging, however this should not be taken as an indication that people are prosperous and financially secure. There remains a vast majority of individuals who are still struggling with their personal finances. This is evidenced by consumer spending falling as people continue to prioritize paying down their debt."

"Individuals typically petition for bankruptcy because of credit card and bank debt that they cannot repay however in recent times we have seen more manageable repayment plans put in place by lenders. This has allowed indebted individuals to pay off their debts over a longer period of time instead of entering formal insolvency. If lenders were to become more aggressive in their pursuit of debts owed it is likely that we will see more individuals becoming insolvent."  

The full statement can be read here.