Abacus Daily Debt News

Insolvency figures “unbelievably frightening”

The latest insolvency figures released by the Insolvency Service - which revealed an increase of 28 per cent in the third quarter of 2009 on the previous year - have been described as “unbelievably frightening”.

This is the opinion of Vantis Business Recovery’s director Nick O’Reilly, who observed that the number of bankruptcies in the UK was 20,000 only 30 years ago.

Remarking on the fact that such debt problems may jump to almost 150,000 in one calendar year, Mr O’Reilly noted that the change in the public’s attitude towards credit is “long overdue”.

“The problem with credit … is that it’s too easily available,” he said, adding that it is the wrong way to borrow money.

According to the Insolvency Service, there were 35,242 personal insolvencies across England and Wales in the third quarter of 2009, with a total of 98,568 throughout the whole of the year thus far.

By Sarah Adie

Abacus Comment: It’s not only the public’s attitude towards credit that needs to change - but also the credit industry’s. Unsolicited credit is still with us. Many Christmas shoppers will be sold store cards in the coming weeks without any intention of obtaining one before they entered the store. The game plan from the store is simple - allow consumers to spend more than they can afford;  many will, and will eventually need a debt management solution.