Number of indebted companies in Poland rises to 331,200 in 2024

The number of companies struggling with overdue payments in Poland increased by 12,300 over the past year, bringing the total to 331,200, according to data from BIG InfoMonitor and BIK. The rise in financially distressed businesses is particularly noticeable in the transport, shipping, and logistics (TSL) sector and waste management industry, both of which are facing increasing credit risk.

At the end of 2024, the total credit and non-credit arrears of companies that had been overdue for more than 30 days and amounted to at least PLN 500 exceeded PLN 43.8 billion. While the overall increase in arrears was slightly slower than the previous year, the number of financially troubled companies grew at a faster rate. From January to December 2024, company debts increased by PLN 1.95 billion (4.7%), compared to PLN 2.4 billion (6%) in 2023. However, the number of companies with financial difficulties rose by 4% in 2024, doubling the 2% increase recorded in the previous year.

Sectors with the Highest Debt Levels

The wholesale and retail trade sector continues to have the highest level of arrears, nearing PLN 9 billion. It is followed by manufacturing (PLN 6.9 billion), construction (PLN 5.6 billion), and transport and logistics (PLN 3.3 billion). Other industries with significant outstanding debts include professional, scientific, and technical activities (PLN 2.8 billion), real estate services, and the HoReCa sector, both of which have arrears exceeding PLN 2 billion.

Despite the overall rise in indebtedness, some sectors recorded improvements. Construction companies reduced their overdue payments by PLN 421 million (7%), while the manufacturing sector saw a PLN 391 million (5.4%) decrease. In mining, overdue debt fell by PLN 60.5 million (8%), while the agriculture sector recorded a slight improvement with a PLN 4.6 million (1%) reduction in arrears.

Increase in Financial Distress Across Sectors

Some industries saw a significant rise in outstanding debt. Educational institutions recorded a 32% increase, reaching nearly PLN 280 million, due to declining student enrollment and rising infrastructure costs. Energy, gas, and hot water supply companies also experienced a 31% increase, with total arrears reaching PLN 173.4 million.

Other key sectors with rising debt include scientific and technical activities (+PLN 304.4 million, 12.4%), TSL (+PLN 237 million, 8%), finance and insurance (+PLN 206 million, 23%), and HoReCa (+PLN 189 million, 10%).

Industries with the Highest Financial Risk

The TSL industry continues to have the highest percentage of financially distressed companies, with 9% of all registered transport companies facing serious financial difficulties. The mining sector, waste management, and water supply services also show high levels of financial instability, with 7.6% of companies in these industries experiencing payment issues. The catering and accommodation sector follows closely with 6% of businesses struggling with overdue debts.

Despite a slower increase in total arrears, the average overdue debt per company continues to rise, now standing at over PLN 132,000 per entrepreneur. The growing number of distressed businesses underscores the challenges in multiple industries, raising concerns about financial stability and the risk of insolvencies in Poland’s corporate sector.

Source: ISBnews, BIG InfoMonitor and BIK