February 2022
February 2022
Personal insolvencies in Germany increased significantly in 2021. There were a total of 109,031 personal insolvencies, 93.6 percent more than in the same period of the previous year (2020: 56,324).
These are the key findings from the current "Debt Barometer 2021" by information service provider CRIF. After ten years of falling case numbers, personal insolvencies in 2021 rose again for the first time, but remained below the previous record of 139,110 personal insolvencies in 2010.
"The significant increase in personal insolvencies last year is largely due to the fact that many private individuals held back their insolvency applications in 2020. Those affected wanted to benefit from a regulatory reform and take advantage of the announced reduction in the duration of proceedings from six to three years and consequently did not file until 2021," explained the Managing Director of CRIF Germany, Dr. Frank Schlein. "This catch-up effect drove the number of personal insolvencies sharply upward in 2021," added Dr. Schlein.
In addition, the economic consequences of the coronavirus pandemic had an impact on personal insolvency figures last year. For many employees and self-employed people who lost all or part of their income during the pandemic, any financial safety nets they had were eventually depleted. In Germany, considerable financial effort and numerous aid packages were put in place to try and keep the economic damage to a minimum. These measures have had a positive effect on the solvency of private households. Otherwise, even more personal insolvencies could have occurred in 2021. "The coronavirus pandemic highlighted how quickly unpredictable external events can unexpectedly put people under financial stress," explained Dr. Schlein.
In 2022, the financial situation of consumers in Germany remains strained. Many people who suffered drops in income during the coronavirus pandemic, for example, due to unemployment or short-term work, have tried to hang on and cope with their financial situation on their own through reserves or privately borrowed money. "The financial reserves of many of those affected have been depleted. Added to this are the steadily rising rents and energy prices. We therefore expect personal insolvency figures to remain high in 2022. This year, there could be up to 110,000 cases again," commented Dr. Schlein.
Nationwide, 131 personal insolvencies were calculated per 100,000 inhabitants in 2021. The regional trend of recent years continued in 2021: the northern German states were more affected by personal insolvencies than the south of Germany. Bremen, for example, leads the statistics with 247 personal insolvencies per 100,000 inhabitants. It is followed by Lower Saxony with 180 and Hamburg with 172 insolvencies per 100,000 inhabitants.
Bavaria (86 cases per 100,000 inhabitants), Baden-Württemberg (99) and Thuringia (109) recorded the fewest personal insolvencies in 2021. In absolute terms, the states of North Rhine-Westphalia (27,263), Lower Saxony (14,384) and Bavaria (11,345) lead the insolvency statistics.
In seven German states, personal insolvencies more than doubled in 2021 compared with the previous year. Hamburg (up 135 percent) and Mecklenburg-Western Pomerania (up 132.2 percent) lead the way.
