Mushrooming personal debt among Scots has been reflected in the latest jump in the number of insolvencies in the past year.
New figures show that 13,998 went through either of the two types of insolvency in the 12 months to March 31, compared with 12,495 in the previous 12 months, an increase of 12%.
It is the latest step in a worrying trend analysed by Johnston Carmichael, Scotland's largest independent firm of chartered accountants, whose figures show that in the past nine years sequestrations - the Scottish version of bankruptcy - have risen by 84%, and Protected Trust Deeds, a less formal process, by 500%.
The most recent trend shows that there were 1505 sequestrations in the first quarter of this year, up 21% on the same quarter last year, and 1966 trust deeds, a rise of 15%.
The total for the past 12 months was 5694 sequestrations and 8304 trust deeds.
Matt Henderson, business recovery and insolvency partner with Johnston Carmichael, said: "The quarterly figures for 2006 were alarming but these latest statistics for the first quarter of 2007 show that the upward trend continues. These statistics only record those individuals who have gone through a formal insolvency process and it is likely that there are many other thousands of Scots who are struggling to avoid financial disaster."
He said that, thanks to the ubiquitous availability of credit, record numbers had an impossible debt burden and were choosing bankruptcy or Trust Deeds to escape.
Mr Henderson also urged caution on the use of consolidation loans: "Try to strike an arrangement with your creditors instead of hiding from debt. It isn't going to go away."
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article