Issue 438 (Week ending 10/02/2021)

Ireland saw its combined commercial and consumer bad debt judgment value drop 76% in 2020 even with unemployment and economic uncertainty at an all-time high. This is also true for Personal insolvency arrangements and bankruptcies.

The suspension of activities during the lockdowns coupled with Government support and moratoriums, are all likely to have significantly contributed to the significant decrease in bad debt, personal insolvency and bankruptcy in Ireland in 2020.

Bad Debt

Since the recovery from the last recession Ireland has seen the number and value of bad debt judgments decrease steadily over the last 8 years. The same can be said for 2020 which followed this downward trend with a substantial 76% drop in value (43m vs 176m) and 57% drop in the number of bad debt cases (1,321 vs 2,997). Unlike the last recession the extensive closure of the courts in the first lockdown as well as the high level of Government supports for both businesses and individuals has caused a large decrease in cases with the average value standing at E32,551 compared with E59,119 in 2019.

• The average value of bad debts for individuals equalled E41,900 and E14,300 for companies.
• The majority of the total value of judgments was against consumers and accounted for E37m of the E43m total.
• The top plaintiff for both consumer and commercial judgments was Revenue with E12.7m and E1.36m respectively.

Personal Insolvency & Bankruptcy

For Personal Insolvency, there was a 30% decrease in approved arrangements in H1 2020 compared with H2 2019. These figures show the positive impact moratoriums had at supporting people during the first lockdown period. Even though the ISI was fully operational during this period, the need for people to apply reduced while they were supported financially with initiatives like the Pandemic Unemployment Payment, Employment Wage Subsidy Scheme etc.

In the period of H1 2020 compared with H2 2019:

• Personal Insolvency Arrangements dropped by 20% (435 vs 543)
• Debt Settlement Arrangements dropped by 47% (33 vs 62)
• Debt Relief Notices dropped by 61% (53 vs 136)
• Protective Certificates dropped by 40% (652 vs 1,084)
• The value of all arrangements totalled 393m.

Those individuals who entered into bankruptcy halved in 2020 compared with 2019. 129 people filed for bankruptcy in 2020 compared to 258 in 2019. The value equalling 516m.

Tracking and performing due diligence on your customers has never been more important in a time when uncertainty is at its highest. With CRIFVision-net you can search any Irish individual with our CCI Check (Credit Check Individual) for all of the above arrangements and bankruptcies as well as many other data sets in order to fulfil compliance on your customers.

For a full breakdown of the bad debt in Ireland in 2020, read the CRIFVision-net Annual Review by clicking her