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The Berlin-Brandenburg Statistics Office today published the latest data on consumer insolvencies in the first quarter of 2023. A total of 1,043 insolvency proceedings were filed against "other debtors" (including shareholders, formerly self-employed persons, consumers and estates) from January to March. This marks an increase of 2.6 percent compared to the previous year.
Outstanding accounts receivable for the period amounted to EUR 77.5 million, a decrease of 4.6 percent compared to the same period last year when accounts receivable amounted to EUR 81.2 million.
987 of the requested procedures were opened. In 40 cases, however, the case was dismissed for lack of assets, since the debtor's assets were not sufficient to cover the costs of the proceedings. In addition, 16 procedures were completed with the acceptance of a confirmed debt settlement plan.
The proceedings were spread across different groups of debtors. In the first quarter of 2023, a total of 286 insolvent former self-employed were recorded, which corresponds to an increase of 38.2 percent compared to 2022. The liabilities of this group increased by 4.0 percent to EUR 43.9 million. In contrast, 733 procedures were opened against consumers affected by insolvency, which represents a decrease of 7.2 percent compared to the previous year. The liabilities of this group fell by 8.8 percent to EUR 32.0 million. The average debt per consumer was around EUR 43,600, slightly below the level of the previous year.
Looking at consumer bankruptcies by district, most cases were recorded in Marzahn-Hellersdorf and Lichtenberg, with 98 and 82 applications, respectively. The lowest number of over-indebted people was reported in Steglitz-Zehlendorf with 36 cases. With regard to the average debt per consumer procedure, Charlottenburg-Wilmersdorf and Tempelhof-Schoeneberg stood out with values of around EUR 87,100 and EUR 57,300, which clearly exceeded the state average.
An important comment on the interpretation of the data concerns the development of consumer insolvencies since mid-2020. This should be seen in connection with a change in the law that provides for a gradual reduction in residual debt discharge procedures from six to three years. This new regulation applies to consumer insolvency proceedings that have been filed since October 1, 2020. It enables those affected to start a new business faster after the insolvency proceedings have been completed. This could explain why many over-indebted private individuals temporarily withheld their bankruptcy applications in order to benefit from the new regulation. From the beginning of 2021, these "catch-up effects" led to a sharp increase in consumer bankruptcies, which has apparently leveled off in the meantime.
Overall, the figures for consumer bankruptcies in the first quarter of 2023 in Berlin illustrate the complex economic challenges faced by individuals and formerly self-employed in an ever-changing economic landscape.