Germany recorded the highest number of declared consumer bankruptcies in January in ten years. According to consumer bankruptcies (Verbraucherinsolvenzen), their number exceeded the 10,000 mark. The main cause is persistently high inflation and the high cost of living, which burden households. Experts predict a further increase in these indicators in the coming months.
Record number of bankruptcies
In January 2026, over 10,000 consumer bankruptcies were declared in Germany. This is the highest monthly number in ten years, i.e., since 2016.
Inflation and high prices
The main driver of rising bankruptcies is persistently high prices for many goods and services, which burden household budgets and make it difficult to repay existing obligations.
Forecasts of further increase
Experts and market analysts forecast that the number of consumer bankruptcies will rise in the coming months, continuing the upward trend observed since last year.
Legal and economic consequences
The consumer bankruptcy procedure allows debtors to free themselves from debts, but it is a legal process with specific requirements and consequences. Its increase indicates financial problems in society.
Germany recorded a record, the highest in a decade, number of declared consumer bankruptcies in January this year. The monthly number of cases exceeded the 10,000 threshold, reaching a level not seen since 2016. The main driver of this concerning statistic is persistently high inflation and the high cost of living, which heavily strain citizens' wallets. High prices for energy, food, and other basic goods make it difficult for households to repay previously taken loans and obligations. The institution of consumer bankruptcy (Verbraucherinsolvenz) was regulated in Germany in 1999, and its current form results from a 2014 reform. This procedure, often called a "clean slate," allows individuals to free themselves from excessive debts after meeting a series of conditions, including a multi-year probationary period and allocating part of their income to repay creditors. Market analysts and economists forecast that the upward trend in the number of bankruptcies will continue in the coming months. This is indicated by the continuation of price pressure and the lag effect with which economic difficulties translate into legal decisions. The rising wave of consumer bankruptcies is a clear signal of the deteriorating financial situation of a significant part of society. This could also have consequences for the banking sector and lending institutions, which must anticipate a higher number of non-performing receivables. In response to this situation, consumer organizations are calling for strengthening financial counseling for citizens threatened by a debt spiral. It is worth noting that while the January data is alarming, the upward trend had already been observed in previous quarters. In the context of the overall condition of the German economy, which has recently been grappling with stagnation, growing household debt problems may constitute an additional factor hampering consumption and growth. This situation also raises questions for policymakers about the adequacy and accessibility of existing social assistance instruments and the effectiveness of the fight against inflation.