Businesses in Cyprus close down every month and despite the tools that the Insolvency Service is offering to businessmen, they prefer to shut down their businesses instead of trying to keep it alive.
According to data from the Insolvency Service, voluntary liquidations in 2020 were 2,235 from 2,097 in 2019, 2,378 in 2018, and 2,497 in 2017.
During the first 10 months of 2020, voluntary liquidations were 1,669 compared to 1,679 last year and 1,650 in 2019.
As revealed by data, there is low interest in personal repayment plans. Applications in 2020 were 102, from 63 in 2019.
Christine Lagarde, President of the European Central Bank, said banks should stop financing non-viable businesses. As she said the target of liquidity injections were the households and the healthy businesses but banks used part of this money to keep problematic businesses alive. The European Central Bank believes these problematic businesses constitute an obstacle to development and is asking banks to lead these businesses to bankruptcy.