Personal Insolvency: Does Europe need harmonised rules? A Finance Watch event

Over-indebtedness is a serious problem in Europe, one that comes at a high price. Faced with a reduction in disposable income due to higher costs for basic everyday goods and services in a persisting cost-of-living crisis, the number of over-indebted people across the continent has risen recently and is expected to continue increasing in the coming months and years.

As the number of people struggling to repay their existing debts grows, so too do the economic and social costs associated with over-indebtedness. High levels of over-indebtedness negatively impact work productivity, increase the demand and costs of both healthcare and social welfare and ultimately, leads to an overall fall in a country’s economic output.

So what can be done to address this growing issue in Europe?

With the goal of bringing together leading researchers in this field, voices from Member States, and EU policymakers, this hybrid event was an opportunity to explore this question and discuss how to move forward.

The conversation was centered around one of the most talked-about solutions on the table – a harmonised EU personal insolvency framework.

Personal or consumer insolvency are umbrella terms for debt relief mechanisms that can be activated when an individual is unable to repay their debts.

Today in the EU, debt relief measures are different in each Member State. This means that the level of support available to citizens who find themselves unable to pay their bills varies greatly depending on where in Europe they live.

Would an EU-wide personal insolvency scheme make things better for European citizens and reduce the economic burden of over-indebtedness for Member States? If so, what would such a scheme look like? If not, what are alternative ways to address over-indebtedness?

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SPEAKERS:
- Elena Brolis, European Commission
- Daniela Vandone, University of Milan
- Monica Calu, Consumers United
- Vasiliki Yiatrou, European University Institute

MODERATOR:
Alison Burns, Press Officer at Finance Watch
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* This video is a replay of the Finance Watch event "Personal Insolvency: Does Europe Need Harmonised Rules?" which took place on November 7th 2023.

For more on Personal insolvency, please refer to our publications and articles on our website:

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