Personal Bankruptcy Filings Surge to Nearly 40,000 in Q1 Amid High Inflation and Interest Rates

Personal bankruptcy filings in the first quarter of this year approached 40,000 cases, a 13.1% increase compared to the same period last year. Applications for individual debt relief, where individuals liquidate all assets due to inability to repay debts, also hit their highest level since 2021.

The prolonged period of high inflation and interest rates is exacerbating economic difficulties for households and businesses, leading to a sharp rise in corporate bankruptcy filings. In the same period, corporate bankruptcy applications stood at 580 cases, a 28% increase year-on-year, marking the highest figure for a first quarter on record.

Economic experts pointed out that the deteriorating financial situation of ordinary citizens and small and medium-sized enterprises could have a significant negative impact on the real economy. A research fellow at the Korea Institute of Finance urged the government to establish fundamental measures to revitalize domestic demand.