Number of personal bailout applicants dips in Q1

The number of people applying for a personal bailout program declined nearly 10 percent in the first quarter of 2015 from a year earlier, court data showed Sunday.

A total of 25,775 people applied for a personal bailout in the January-March period, down 9.6 percent during the same period a year earlier, according to the data.

The dip is seen as indicating that a spike in people requesting for arbitration to get more leeway to pay back their debts from 2010 through 2014 may be on the wane.

In 2010, there were 46,972 people signing up for personal bailouts with the number jumping to 90,368 in 2012 and hitting 110,707 last year.

The government-assisted personal bailout, referred to as the individual rehabilitation program, is designed to give a second chance to people on the verge of insolvency by rearranging credit obligations and legal duties to write off their debts.

The program, launched in 2004, is available to people with a stable source of income and less than 1 billion won (US$917,000) in debt.

Court data, however, showed that while there were less people applying for rehabilitation, the total number of people requesting help from the Credit Counseling and Recovery Service remained relatively unchanged.

Besides the personal bailout program, the service processes personal bankruptcy, individual workouts and so-called free workout applications in order to support people with debt problems.   

There were some 62,601 people that asked for all forms of assistance in the first three months of this year, down just 0.6 percent on-year from 62,949. (Yonhap)