In Focus Consumer Credit
they are used for smaller debt and asset levels than other personal-insolvency procedures. Bankruptcy was once again the procedure
which was used by more men than women. It is often linked to the closing or insolvency of a business where directors – who are more likely to be men than women – have given personal guarantees to lenders for business debts, are reliant on their income as a director, or where an individual is a sole trader liable for their business debts. The gender split in IVAs is broadly the
same as last year. IVAs are typically used to handle consumer debts, such as credit-card debt, and their take-up is partly driven by marketing, and how aware people are of them as an option. There is no doubt that wider structural
inequalities within society have an impact on the gender split within insolvency, but it is important to remember that, for many people who become insolvent, the process offers the opportunity for a fresh start, financially speaking. Given the many overlapping and
interlocking ways that women are generally more disadvantaged from an economic point of view, we are unlikely to see gender balance in personal-insolvency rates any time soon.
Regional The areas with the highest levels of personal insolvency are largely unchanged from last
September 2019
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year. A higher personal-insolvency rate is a symptom of wider deprivation, and highlights the need for debt-advice services to be targeted and tailored for people living in less affluent areas. The historical retreat of the industrial
Bankruptcy was once again the procedure which was used by more men than women. It is often linked to the closing or insolvency of a business where directors – who are more likely to be men than women – have given personal guarantees to lenders for business debts, are reliant on their income as a director, or where an individual is a sole trader liable for their business debts
sector caused decades of hardship in many places, as well-paying jobs disappeared which were replaced, at best, by more precarious and worse-paid employment. Coastal areas often have higher rates of
personal insolvency than inland areas. As places which very often depend on
an influx of tourists in the summer months for income, they are dependent on the consumer pound, which has been in shorter supply of late. The seasonal nature of tourism-related
work makes it hard for many residents to build up savings to last them in leaner times, leaving them vulnerable to the type of economic shock that can often trigger insolvency. Although the rate of growth of consumer
debt has slowed, the amount owed by individuals is still rising, while inflation- adjusted employees’ earnings are still lower than before the 2008-2009 recession, according to the ONS. Ensuring that people in problem debt are
aware of their options, and that they can access a suitable form of personal insolvency if that is the best option for them, should be a priority for the government. CCR
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