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The Increase in Bankruptcies in Brazil Exposes the Effects of High Interest Rates, Persistent Inflation, and Restricted Credit. The Scenario Impacts Companies of Different Sizes and Rural Producers, with Numbers Indicating Records in 2025.
The bankruptcies declared in Brazil have advanced 25% in three years, rising from 622 cases in 2021 to 780 in 2024, according to data from Serasa Experian.
In April 2025, the country recorded 75 bankruptcy declarations in the month, double the number observed in April 2020 (37), signaling an acceleration of corporate litigation.
The data includes companies of various sizes and individual rural producers, according to a survey released by Poder360.
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Most Recent Numbers on Bankruptcy in Brazil
The movement in 2025 is already under pressure. By April, the records show 236 bankruptcy petitions year-to-date, while declarations totaled 282 in the same period.
The reading reinforces that the liquidity crisis and the worsening cash flow continue to produce effects on active businesses across different sectors.
Poder360 highlights that if this pace continues, the year could end with a new historical record.
Although petitions and rulings progress at different rates, the annual snapshot of 2024 helps to frame the situation: there were 949 bankruptcy petitions and 780 bankruptcies declared.
The disparity between requests and rulings reveals the gap between the request made by creditors or the companies themselves and the declaration effectively issued by the courts, which marks the end for debt settlement.
Difference Between Petitions and Declared Bankruptcies
A bankruptcy petition is the formal opening of a process, which can be denied, dismissed, converted into an agreement, or proceed to analysis until a ruling.
Declared bankruptcy is the judicial act that closes business operations for creditor payment, following contradictions and verification of legal requirements.
Therefore, the number of declarations tends to react with a lag to credit and activity cycles, while the petitions reflect more immediate pressures on cash flow.
In 2024, the statistical base showed fewer petitions than in 2023, but more declarations than in 2021.
The dynamic is consistent with an economy that has faced high interest rates, persistent inflation for part of the period, and more selective credit, conditions that compress margins and prolong the financial normalization of businesses.
Judicial Reorganization and Business Insolvency
The search for judicial reorganization has significantly advanced and helps to explain why not every petition leads to bankruptcy.
In 2024, there were 2,273 petitions for judicial reorganization, the highest volume in the historical series, up 61.8% from 2023, according to Serasa Experian.
This legal instrument functions as an attempt to reorganize to preserve activity and employment, avoiding forced liquidation.
Still, some cases migrate to bankruptcy when the plan fails to hold.
The portal Poder360 emphasizes that the combined reading of these indicators — bankruptcy petitions and decrees, along with reorganizations — creates a coherent picture of more indebted companies facing difficulties rolling over commitments in the short term.
The increase in declarations in 2024, compared to 2021, and the jump observed in April 2025 compared to 2020 reinforces this trajectory.
Interest, Inflation, and Credit: Impact on Companies
The more restrictive monetary policy in recent years has raised the cost of debt and increased working capital costs. Even with cycles of cuts in the base rate, the pass-through to credit is usually gradual.
At the same time, inflation has eroded part of the demand and pressured operational costs, while credit provision has become more stringent.
The combined effect limits the ability to replenish cash and meet obligations, especially in segments sensitive to short-term financing.
In this environment, micro and small businesses tend to feel the restrictions first, as they depend more on working capital and have fewer funding alternatives.
Medium and large companies, although they have access to more sophisticated instruments, face refinancing challenges in volatile scenarios with high spreads.
The consequence is a larger pipeline of companies seeking judicial protection and, later, some of them reaching bankruptcy rulings.
April 2025 in Historical Perspective
The data from April 2025 — 75 bankruptcies declared in the month — warrants attention due to historical comparison.
This figure is 102% higher than that of April 2020 (37), a period when the pandemic was beginning to impact the real economy most acutely.
Even though the shocks are distinct, the comparison illustrates the intensity of the current financial pressure.
Meanwhile, the accumulated bankruptcy petitions up to April 2025 (236) show that the entry point of the insolvency system remains active.
This reflects the difficulty in honoring commitments amid tight margins and tougher negotiations with creditors.
The realization of declarations depends on procedural developments, but the current base is already sufficient to explain the increase in litigation.
What to Follow in the Coming Months
The evolution of judicial reorganization petitions throughout 2025, compared with the series of bankruptcies declared, will be crucial for assessing the capacity for business restructuring.
Additionally, the trajectory of real interest rates, cost inflation, and credit availability will continue to be key variables for the financial health of companies, especially among the smaller ones.
In this context, what other market signals will help indicate improvement or deterioration of solvency conditions?
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