Berlin [Germany], December 9: German corporate insolvencies rose to their highest level in more than a decade in 2025, underscoring mounting pressure on businesses amid a prolonged economic downturn and domestic policy uncertainty, a report said on Monday.
A total of 23,900 German companies filed for insolvency during the year, an 8.3 percent increase from 2024, according to new data from credit agency Creditreform.
Bankruptcies rose across nearly all major sectors of Europe's largest economy, with the sharpest increases recorded in both manufacturing and trade, where cases increased by more than 10 percent. The services sector recorded the largest number of insolvencies, with around 14,000 cases, up 8.4 percent year-on-year.
"Many firms are highly indebted, struggling to access new credit while facing structural burdens such as high energy costs and regulation," said Patrik-Ludwig Hantzsch, head of economic research at Creditreform. He noted that the pressures are particularly severe for small and medium-sized enterprises, threatening the viability of many businesses.
Small firms with no more than 10 people were hit hardest, accounting for 81.6 percent of all insolvency cases, the report showed. In total, corporate bankruptcies impacted an estimated 285,000 employees.
The financial strain is also spreading to households. Personal insolvencies continued to rise in 2025 as over-indebtedness increased, Creditreform said. Around 5.67 million people in Germany are currently considered over-indebted, meaning their debt levels exceed what they can reasonably repay.
High living costs, job cuts, and rising unemployment were cited as the main drivers behind the increase in personal insolvencies.
Looking ahead, Creditreform CEO Bernd Buetow warned that corporate insolvencies are likely to keep rising as Germany's competitiveness continues to erode. He said the government's planned multi-billion-euro investments in infrastructure may support growth next year and help slow the pace of insolvency filings, but additional structural reforms will be needed to stabilize the economic base.
Source: Xinhua News Agency
