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Thursday, July 25, 2013

Bankrupt Scots

The recent downward trend in the number of individuals and companies going bankrupt in Scotland has reversed dramatically in recent months, official figures show.

In the first quarter of 2013-14 (April to June) personal insolvencies were up 14.7 per cent and corporate insolvencies were up 28.7 per cent.

Bryan Jackson, business restructuring partner with BDO LLP, said the rise in payday and short-term lenders points to "serious financial problems among thousands of Scots".

Mr Jackson said: "Following recent falls, the increase in the number of personal insolvencies in the second quarter suggests that the pent-up indebtedness of many individuals has burst through.There is little doubt that many individuals have been living from month to month, or week to week, simply feeding the interest on their debts rather than reducing the debt itself. Until now, this has delayed some from falling into insolvency, but this quarter's figures suggest that their financial situation has deteriorated beyond the point where they could cope and this has resulted in their bankruptcy. Unfortunately, I would not be surprised to see continued increases in personal insolvencies in the months to come. The increase in the number of payday and short-term lenders is indicative of serious financial problems among thousands of Scots whose circumstances will only be exacerbated by such loans."

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