Corporate bankruptcies in Germany rose sharply in 2025, reaching their highest level in more than 10 years as businesses struggled with a prolonged economic downturn and policy uncertainty, according to data released Monday by credit agency Creditreform.
A total of 23,900 companies filed for insolvency during the year, an increase of 8.3 percent from 2024. Nearly all major sectors saw more bankruptcies, with manufacturing and trade recording double-digit increases. The services sector accounted for the largest share, with about 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 small and medium-sized enterprises were particularly vulnerable.
Small firms with fewer than 10 employees made up 81.6 percent of all insolvency cases, affecting an estimated 285,000 workers.
The strain has also spread to households. Creditreform reported that personal insolvencies continued to rise in 2025, with about 5.67 million people considered over-indebted — unable to reasonably repay their debts. Rising living costs, job losses and higher unemployment were cited as key drivers.
Looking ahead, Creditreform CEO Bernd Buetow warned that insolvencies are likely to keep climbing as Germany’s competitiveness erodes. He said government plans for multi-billion-euro infrastructure investments could support growth and slow the pace of bankruptcies next year, but added that deeper structural reforms will be needed to stabilize the economy.