Despite record inflation and the energy crisis: German payment behavior has hardly changed. Debt collection companies report that missed bills are paid surprisingly well. The outlook for the coming year is gloomy. The big price shock was still to come for consumers.
According to the Federal Association of German Debt Collection Companies (BDIU), the payment behavior of defaulting consumers has hardly changed this year – despite record inflation and the energy crisis. In a survey of around 250 member companies, 48 ??percent of debt collection companies reported that the payment behavior of private debtors had only slightly deteriorated. According to the association in Berlin, 39 percent stated that payment behavior had remained roughly the same compared to 2021. Only 9 percent observed a severe deterioration in payment behavior. One of the reasons for this is the low unemployment rate.
The crisis had little impact on the payment behavior of commercial debtors either. “It’s a bit paradoxical, because although we have been living in a kind of permanent economic crisis for two years – with the beginning of the corona pandemic – bills are still being paid surprisingly well,” said BDIU President Kirsten Pedd. The number of debt collection orders, which is an indicator of future development, has remained almost unchanged, as reported by 45 percent of the companies surveyed. 34 percent report moderate increases in orders.
According to the information, inflation is an important factor in the reasons why private debtors have not paid their bills. Every second collection agency reported that liquidity bottlenecks due to higher costs were often a reason for non-payment. “Many people are now being forced to draw on their savings to service their running costs,” Pedd said. That is alarming, because the big shock, for example for electricity and heating, is yet to come for many households.
The main reason why commercial debtors left invoices unpaid was payment defaults by their own customers, according to the collection service providers. But here, too, the situation was not critical. 46 percent of the collection agencies observed that the payment behavior of commercial debtors had hardly changed, 41 percent reported a slight deterioration.
The association expects payment practices to deteriorate in the coming year. “Nine out of ten debt collection companies expect that payment behavior will deteriorate in 2023 – and this is particularly true for private debtors,” it said. Nobody in the survey expects better accounting.
