Debtors filed more than half of bankruptcy applications in 2024

MinLaw data shows number of borrowers declared bankrupt rose by 12.4% to 1,232

- Chor Khieng Yuit

More than half of the bankruptcy applications in 2024 were made by the debtors themselves, according to the Ministry of Law (MinLaw).

This is the fifth consecutive year since 2020 that the number of self-filed applications was higher than the number of applications by creditors, based on figures the ministry provided.

MinLaw data showed that 2,928 bankruptcy applications were filed by debtors in 2024. That represents 59 per cent of all applications made that year.

The remaining 1,997, or 41 per cent of bankruptcy applications, were made by creditors.

The total of 4,925 bankruptcy applications filed in 2024 was a 24 per cent increase from the 3,986 cases in 2023.

Ms Debby Lim, senior partner at law firm Dentons Rodyk & Davidson, said the relatively higher self-filed numbers could be an indication that bankruptcy is less of a stigma these days.

"The idea is that it (bankruptcy) is not the end of the world," Ms Lim said.

Ms Tan Huey Min, general manager of the non-profit Credit Counselling Singapore (CCS), noted that some people may have filed for bankruptcy despite there being other avenues to resolve their debt.

"These people who self-file, how many are because they went to see the private debt consulting firms and received information that may not be the most objective or most complete?" Ms Tan said.

"There are other solutions to address a debt problem than to go and file for bankruptcy so that one may be placed under the Debt Repayment Scheme."

CCS, for example, runs a debt management programme that helps debt-distressed borrowers work out a plan to repay all their creditors through affordable instalments every month.

A debtor does not need to file for bankruptcy to qualify for the CCS programme.

There is also the Debt Repayment Scheme (DRS), a pre-bankruptcy scheme administered by MinLaw. A debtor can avoid being made bankrupt if he is put on the DRS.