Record growth of bankruptcies recorded in Russia in spring 2022

Over 60,000 insolvency applications were filed in Russia in the first two spring months of 2022.  This number significantly exceeds the figures of both last year and the year before the last.  At the same time, the bulk of cases are bankruptcy cases of individuals.

According to experts, the reasons for the current situation are both a decrease in the income of the population, and a growing debt burden, as well as a desire to avoid paying bills through a legal insolvency procedure.

The upward trend in bankruptcy filings began two years earlier during the coronavirus pandemic. From that moment on, each subsequent year was ahead of its predecessor in terms of such cases. Another reason for the active spread of the procedure is the awareness of citizens about such a possibility. Over the years, the number of people who learn about their right to file for bankruptcy and write off debts has grown, reports Forbes.

If we talk about bankruptcy of individuals, in the majority of cases they initiate the proceedings themselves. Basically, these are the least well-off categories of the population, for whom the measure becomes a way out of the debt hole. That is why the bankruptcy moratorium introduced in April did not significantly affect the growth of insolvency cases among individuals: restrictions on initiating proceedings apply only to creditors.