SINGAPORE – More people are being declared bankrupt in Singapore, going by the latest official statistics, although their age distribution has largely stayed the same.
Personal bankruptcy cases reached 482 in the first quarter of 2026, up from 378 in the same period in 2025, according to data from the Ministry of Law (MinLaw).
A spokesperson for MinLaw told The Straits Times there are five reasons why most people become bankrupt. These are business failure; overspending on consumer goods and services; unemployment or retrenchment; acting as a guarantor for a business or another individual; and insufficient income to meet daily expenses.
Such information is declared to the authorities when a person applies for bankruptcy in Singapore or is made bankrupt by a creditor.
The age distribution of bankrupts has remained largely stable year on year, MinLaw noted.
Between 2016 and September 2025, those aged 40 to 54 formed the largest group of bankrupts, accounting for almost half, or 47 per cent, of the 12,238 cases.
Those aged 25 to 39 made up 29 per cent, and those aged 55 and above constituted 24 per cent. Just under 1 per cent, or 52 individuals, were aged 24 and below.
Declaring bankruptcy should be seen as a last resort, experts said.
Ms Jean Lee, fund-raising manager at Adullam Life Counselling, advised borrowers to seek help early before their debt grows out of control.
“When the debt is smaller, it is easier to talk to creditors,” she said.
However, some hesitate to come forward and will try to resolve the problem on their own.
“The natural reaction is to take debt to pay debts. You solve today’s problem (but) it becomes tomorrow’s problem,” said Ms Lee, whose organisation is a social service agency that helps individuals struggling with debt to avoid bankruptcy.
Mr Jonathan Ong, a licensed insolvency practitioner, said in most bankruptcy cases that he has come across, debtors would have already exhausted all borrowing avenues before seeking help.
By then, it will not be possible to repay or restructure their debt based on their personal or employment situation, added Mr Ong, director of restructuring and insolvency at EisnerAmper Singapore, a global accounting, tax and business advisory firm.
MinLaw data shows that personal bankruptcies hit a post-pandemic peak in 2025. There were 1,623 cases in 2025, the highest since 2019, when 1,645 individuals entered insolvency.
In 2025, Adullam Life Counselling saw a 13 per cent increase in the number of people seeking help with debt issues, reflecting financial strains on the ground.
Ms Lee said they come from all walks of life, with 10 per cent classified as low-income earners, 85 per cent as middle-income earners and 5 per cent in the high-income group.
The number of scam victims seeking help has risen in the last one to two years, she also noted.
The increase was particularly evident in 2025. In December alone, more than half of the cases Adullam counselled were scam-related.
“The scammers are not just scamming people out of their savings. They are actually teaching the victim to take loans to pay them. It is a very dangerous trend,” Ms Lee said, adding that the victims incurred both credit card and moneylender debts.
“First, you wipe out all my savings. Then I am saddled with debt; sometimes, it can be a few hundred thousand,” she added.
Alex (not his real name) fell for an investment scam on Facebook in August 2025 and was declared a bankrupt in early March.
Speaking to ST on condition of anonymity, the 50-year-old said he chalked up $330,000 in credit card debt to invest in the Malaysia, China and Taiwan stock markets.
“They enticed investors to put in more money. So I started to borrow from the banks,” he said.
Alex realised something was amiss only when he was unable to access the investment app and the company did not reply to his messages.
After two months, he could no longer cope with the monthly repayments to the banks. “I had to pay about $6,000 every month,” he said.
He tried to get a debt consolidation plan with the banks, but was rejected. He then sought help from his MP, who referred him to Adullam.
“The amount I owed was too huge, so I was advised to file for bankruptcy,” he said.
Alex is among a small number of clients at Adullam who filed for bankruptcy.
Ms Lee said most of the other cases managed to clear their debts after mediation with creditors to negotiate a repayment plan.
EisnerAmper’s Mr Ong said larger debts of more than $200,000 are typically linked to business failures or the loss of high-income employment.
He added that many business owners go into bankruptcy because they acted as personal guarantors for their business loans from financial institutions and moneylenders.
Joseph (not his real name) filed for bankruptcy in August 2020 when his semiconductor manufacturing business failed during the Covid-19 pandemic.
The business required a huge amount of capital and investments because product industrialisation takes three to four years to become profitable.
Joseph said that his monthly company expenses ranged between $80,000 and $100,000. He realised he needed partners, but the pandemic hit and potential investors put all investments on hold.
“We were already running out of funds. Travel was restricted. We were not able to produce anything (and) workers needed to go back. All came to a halt,” he said.
While still hoping for an investor to save his company, Joseph turned to four moneylenders, ultimately chalking up a total debt of $400,000.
The loans, however, were not enough to pay the salaries of his 10 employees and sustain the business.
Eventually, one of the moneylenders applied to declare him bankrupt.
Now in his 50s, Joseph is in his sixth year of bankruptcy. In Singapore, a first-time bankrupt is generally eligible for discharge if he is able to fulfil the payment of his target contribution within 52 months, or MinLaw may consider discharging him in seven years.
He is rebuilding his life and working as a delivery driver.
People with smaller debts of between $15,000 and $150,000 may be considered for the Debt Repayment Scheme (DRS) after they have filed for bankruptcy.
Ms Lee said there are debt consultancy firms that encourage borrowers to file for bankruptcy to qualify for the scheme.
These debtors are given the mistaken impression that they can restructure their debt under DRS, sometimes paying back only a fraction of what they owed, she noted.
The consultants charge them a fee of $4,000 to $5,000. Some also encourage debtors to take out loans to cover their fees, or to intentionally cross the $15,000 threshold required to file for bankruptcy, Ms Lee noted.
“We feel that is the main reason why the bankruptcy numbers have been increasing,” she said, adding that “there is no sudden jump in the number of real bankrupts”.
Between January and April, the Singapore courts referred 959 cases to MinLaw’s Insolvency Office for assessment under DRS.
This is lower than the 1,226 cases referred during the same period in 2025.
For the whole of 2025, 3,598 cases were assessed, a decrease of 1.5 per cent from the 3,654 cases in 2024. The figures in 2024 were the highest since 2021.
Ultimately, however, bankruptcy should not be viewed as the end of the road.
Mr Vincent Lee, president of Adullam Life Counselling, said that bankruptcy offers individuals an opportunity for a financial and personal reset.
As they work towards clearing their debts, they also begin to refocus on other aspects of their lives, he added.
“We have seen people who are in debt… they start to realise that maybe they have missed out on some very important areas of their life.”
