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Almost 7,000 Malaysians were declared bankrupt last year alone, continuing an upward trend that increasingly affects young adults and women
The latest cases bring the total number of bankruptcies to 100,467.
The Insolvency Department recorded 6,776 new bankruptcies in 2025, an increase of nearly 1,000 from the 5,977 cases in 2024.
Among the states, Selangor recorded the highest number of new cases at 1,570, followed by Wilayah Persekutuan (904), Johor Bahru (577), and Kota Kinabalu, Sabah (447).
Selangor also has the highest cumulative number of bankruptcies to date, with 19,226 cases, followed by Kuala Lumpur (14,181) and Penang (13,620).
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Image via Mikail Ong/New Straits TimesAlarming trends among young adults
A closer look at the data reveals an alarming trend among younger adults.
Last year, individuals aged 20 to 24 were increasingly affected, with 17 new cases, two more than in 2024.
Between 2021 and 2025, a total of 79 young adults in this age group were declared bankrupt, with the highest number recorded in 2021 at 20 cases.
The bulk of bankruptcies over the past five years remain among those aged 35 to 44, accounting for 40% of cases.
In 2025, this age group saw bankruptcies rise to 2,654 cases, up from 2,402 in 2024, an increase of 252 new bankruptcies.
Those aged 45 to 54 also recorded a sharp increase, rising from 1,695 cases in 2024 to 2,065 last year, an addition of 370 new cases.
Another worrying trend is the steady rise in female bankruptcies over the past five years. Last year saw the highest to date with 1,946 new cases, compared with 1,711 in 2024.
Men, however, continue to make up the majority of new bankruptcies, with 4,817 cases last year, accounting for 72% of all cases.
An expert says women in debt are not necessarily financially irresponsible
Malaysia University of Science and Technology (MUST) lecturer, Professor Emeritus Dr Barjoyai Bardai, said the rise in female among bankruptcy cases reflects greater economic participation rather than financial irresponsibility.
"More women are business owners, income earners, and joint borrowers today. Unfortunately, they are also more exposed to income interruptions, caregiving responsibilities, and joint liabilities, especially in cases of divorce or business failure," he said.
Barjoyai added that many women take on joint liabilities as spousal guarantees, shared housing loans, or other financial commitments. When a marriage breaks down or a partner defaults, women increasingly face legal and financial exposure.
"So the rise in women in bankruptcy statistics reflects greater economic participation, but without adequate financial and legal safeguards," he said.
Another notable trend is the rising number of non-Malaysians being declared bankrupt.
There were 139 cases involving non-citizens from 2021 until last year, with the highest number recorded in 2024 at 47 cases.
Last year, there were an additional 29 cases involving foreigners.
