Are economic conditions to blame?
The September quarter of Australian Financial Security Authority
(AFSA) personal insolvency statistics are out, and the trends of
2017 continue. Total personal insolvencies are up by 8% compared to
a year ago, and debt agreements continue their significant growth.
Debt agreements reached a record high of 3,885 and increased to
47.4% of total personal insolvencies. Bankruptcy increased just
0.1% for the quarter.
In September, AFSA also released annual data about personal
insolvency causes for the 2016-17 year. These provide some
interesting insights into what leads to personal insolvency.
Business related personal insolvencies
Just 16.1% of debtors declare bankruptcy for business related
reasons, with economic conditions most often cited as the main
reason. It is worth noting that economic conditions have been the
most common business related cause of debtors entering personal
insolvencies every year since the 2007–08 year.
