Number of Scots going bust falls 24.7 per cent

one the UK’s largest providers of the full range of personal debt solutions.

The latest AiB data, which uses the financial year April to March, reveals that personal insolvencies fell from 11,621 in 2014 to 8,755 in 2015 –a fall of 24.7 per cent.

The number of bankruptcies fell by 34.0 per cent from 6,744 to 4,451 and Protected trust deeds (PTDs) fell by 11.7 per cent from 4,877 to 4,304.

Carrington Dean managing director, Peter Dean, explained: “Although the number of Scots experiencing personal insolvency during 2015 has fallen it is clear that for many Scots a high level of personal debt has become a way of life. A figure of 8,755 Scots being made bankrupt in one year would have been unthinkable not that long ago yet now it has become normal.

“Given that we have an historic low rate of interest, utility bills which are falling, and one of the highest levels of employment ever, it is worrying that so many Scots find themselves in financial difficulty.

“Often such change can occur outwith your control, with divorce, unemployment, bereavement and illness being the most common causes of individuals falling into insolvency. It is essential that people get advice and support at the earliest stage if any change should occur in their circumstances.”

“If people do face personal insolvency it is essential that they have the right options to extricate themselves from their financial difficulties. The number of Scots using the Debt Arrangement Scheme has fallen dramatically since 2011 partly due to the continual promotion of debt management plans by big debt management companies and their reluctance to give clients all the remedies available to them in Scotland.

“The FCA have been very critical of Debt management companies not offering all the available solutions to individuals in Scotland but these debt management plans are more attractive because they offer much more flexibility with DMPs than with the common financial tool as it applies to debt arrangement schemes.

“I believe the Government could do much more to help vulnerable people get an appropriate solution to their situation by being more flexible in the application of the common financial tool in relation to the Debt Arrangement Scheme and allow more Scots to be freed from their indebtedness.”

Mr Dean concluded: “Although the latest personal insolvency numbers for 2015 show an improvement we still have around 180 Scots per week going through the insolvency process. This figure is much higher than historic levels of personal insolvency and I believe that we will continue to see this level of personal insolvency for some considerable time as the after effects of the recession continues to make itself felt eight years after it all began. For anyone worried or concerned about their finances the first step is to get help and seek advice as soon as possible.”