Money Wellness

debts

Published 23 Jul 2024

2 min read

Personal insolvencies increase by 11% driven by debt relief orders

The number of personal insolvencies increased by 11% in June to 10,395, according to the latest figures from the Insolvency Service for England and Wales.

Illustration of a woman snipping lit fuse off a debt bomb with scissors
Caroline Chell - Money Wellness

Written by: Caroline Chell

Head of Communications

Published: 23 July 2024

The growth is because of increases in debt relief order (DRO) applications, which an all-time high last month at 4,383 - a 15% increase from the previous record set in May.

DRO applications are growing because of changes announced in this year’s spring budget by the previous government. Those changes were:

  • getting rid of the £90 administration fee
  • an increase in the maximum amount of debt you can have from £30,000 to £50,000
  • an increase in the value of a vehicle you can own from £2,000 to £4,000

As well as the increase in DROs in June, there were also 651 bankruptcies and 5,361 individual voluntary arrangements (IVAs).

IVA numbers over the past 12 months have been lower than during 2022, which was a record year for the product. But the 5,361 registered in June 2024 was 14% higher than the same month last year and 8% higher than May – the previous month.

In a sign pressure on household finances might be easing, the number of people being granted breathing space in June was down 12% on the same month last year to 6,970.

Caroline Chell - Money Wellness

Written by: Caroline Chell

Head of Communications

Caroline has worked in financial communications for more than 10 years, writing content on subjects such as pensions, mortgages, loans and credit cards, as well as stockbroking and investment advice.

Published: 23 July 2024

The information in this post was correct at the time of publishing. Please check when it was written, as information can go out of date over time.

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Caroline Chell - Money Wellness

Written by: Caroline Chell

Head of Communications

Published: 23 July 2024

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