Gyeonggi-do Seomin Financial Welfare Support Center Surpasses 2 Trillion Won in Cumulative Personal Bankruptcy Discharge Amount

Gyeonggi Province revealed that last year, 1,200 residents received public debt adjustment support such as personal bankruptcy and rehabilitation through the Gyeonggi Province Financial Welfare Support Center (Gyeonggi Financial Welfare Center), and the cumulative amount of personal bankruptcy discharge exceeded 2 trillion won.

On the 4th, Gyeonggi Province announced that last year, public debt adjustments included 1,062 cases of personal bankruptcy and 138 cases of personal rehabilitation, totaling 1,200 people, an increase of 31 people (2.7%) compared to 1,169 people the previous year.

Personal bankruptcy and personal rehabilitation are systems that provide debtors in a situation where they cannot repay their debts with an opportunity to recover by distributing the debtor’s assets to creditors through a court decision (bankruptcy) or by repaying part of their monthly income over three years and having the remainder discharged (rehabilitation).

An analysis of 1,062 residents who received support for personal bankruptcy applications from the Gyeonggi Financial Welfare Center last year showed that the unemployment rate at the time was 84.8%, and the largest age group was those aged 60 and over at 67.3%. Additionally, 80% were basic livelihood security recipients. The majority were living rent-free in public rental housing (85.8%) or in housing owned by acquaintances or relatives (6.2%), while only 0.5% owned their own homes. The average monthly income was less than 1.5 million won for 81.2%, indicating that applicants were maintaining a minimum level of livelihood at the time of their personal bankruptcy application.

A resident visiting the Gyeonggi-do Center for Financial Welfare Support for Low-Income Citizens is receiving legal consultation on personal bankruptcy and rehabilitation. Provided by Gyeonggi-do

Regarding the causes of increased debt, which allowed multiple responses, 46.3% cited insufficient living expenses, and 21.5% cited business failure. Reasons for insolvency included principal and interest exceeding income at 31.9%, unemployment at 17.4%, business closure due to worsening management at 12.8%, and income reduction at 11.5%.

Most applicants had no prior experience applying for personal bankruptcy or rehabilitation (87.7%), and before applying for personal bankruptcy, they had no history of being accused or criminally tried for fraud, fraudulent bankruptcy, or gambling offenses (94.5%).

Kim Hana, Director of Welfare at Gyeonggi Province, stated, "In a situation where the burden of household debt on the working class and vulnerable groups is increasing due to high inflation, high exchange rates, and high interest rates worsening the economy, financial welfare is playing a role as a catalyst for revitalizing the livelihood economy. Through financial welfare that approaches debt problem resolution as welfare, we will create a Gyeonggi Province full of new opportunities."

Meanwhile, the Gyeonggi Financial Welfare Center, which opened in July 2015, has been promoting the conversion of non-regular employees to regular positions since 2023 to improve their treatment, and in recognition of this achievement, received a commendation from the Governor of Gyeonggi Province in December 2024.

This content was produced with the assistance of AI translation services.