A wallet and money in a person’s hand in Helsinki. LEHTIKUVA
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Nearly 1.95 million new payment defaults were recorded in Finland in 2024, marking the highest number of the decade. Despite the rise in default entries, the number of individuals with payment defaults grew at a slower pace, suggesting worsening financial difficulties among those already struggling.
At the end of 2024, nearly 369,000 individuals had at least one payment default, an increase of approximately 18,500 compared to the end of 2023.
Over 301,000 people received new payment defaults during the year, up from 280,000 in 2023.
The increase in payment defaults was seen across all Finnish regions except South Ostrobothnia, where the proportion of adults with payment defaults decreased by 0.01%. However, North Karelia experienced the largest relative rise, with the share of adults with payment defaults growing from 6.28% to 6.85%. Uusimaa saw the largest numerical increase, with nearly 1,000 new individuals recorded as having payment defaults in the last three months of the year.
Mikko Karemo, Deputy CEO of Asiakastieto, called the rising number of defaults a concerning trend, noting that individuals with existing financial difficulties were accruing more entries. He explained that turning the tide on over-indebtedness is challenging once the situation has begun to spiral.
The most significant growth in payment defaults occurred in the second quarter of 2024, with nearly 628,000 new entries recorded. Many were attributed to insolvency declarations during enforcement procedures.
The overall increase in defaults has been further complicated by fluctuations caused by changes to Finland’s credit information law. Since late 2022, credit histories can be cleared once debts tied to payment defaults are repaid. This change initially removed over 18,000 individuals from credit default registries but has not stemmed the broader trend of rising over-indebtedness.
The year ended with a slight slowdown in the rate at which new individuals were recorded with payment defaults. Despite this, the total number of people with defaults remains at its highest since the 2022 credit law reforms. Karemo expressed cautious optimism but warned that unemployment growth and other economic pressures make a quick reversal unlikely.
Debt collection and default patterns illustrate broader economic challenges, including rising unemployment and tighter household budgets. Although new laws and data improvements aim to address financial issues, the overall debt landscape remains strained.
Payment defaults grew in all regions except South Ostrobothnia, where a modest decline was recorded. In North Karelia, the proportion of adults with payment defaults rose the most significantly, reflecting a persistent regional economic divide.
While Uusimaa saw the highest number of new cases, Päijät-Häme had the largest share of its adult population with payment defaults, increasing slightly from 8.63% to 8.7%.
HT
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Source: www.helsinkitimes.fi
