Debt Shock in Turkey: One in Three Citizens Under Enforcement as Closures Surge

Turkey’s 2025 economic balance sheet has revealed a stark, unsettling picture, highlighting a sharp deterioration in the country’s debt repayment capacity. Across the nation, enforcement and foreclosure filings have reached unprecedented levels, exposing a reality in which financial stress is no longer confined to isolated groups but has become a widespread social phenomenon. With enforcement case numbers approaching 25 million, the data suggests that nearly one out of every three citizens is now entangled in some form of legal debt process, while the small business sector faces an equally alarming collapse.

At both household and commercial levels, the economy is grappling with what can best be described as a deepening debt burden crisis. Rising operating costs, shrinking profit margins, and persistent difficulties in accessing affordable financing have combined to push individuals and companies toward default. As bounced checks and unpaid promissory notes multiply, courts across the country are experiencing one of the busiest periods in their history. Compiled by journalist Şehriban Kıraç using official data, the figures have led many observers to label 2025 as the year of bankruptcies and enforcement actions.

Enforcement Files Reach a Critical Threshold

Turkey’s population of roughly 86 million stands in sharp contrast to the 25 million enforcement files currently registered with enforcement offices. This imbalance alone illustrates the scale of the problem. In practical terms, it means that a significant portion of society is either directly involved in or closely affected by legal debt proceedings. Analysts point to the surge in dishonored checks and protested bills as a primary driver of this dramatic rise.

These instruments, traditionally relied upon by businesses and individuals to manage cash flow, have increasingly turned into sources of systemic risk. As payment chains break down, one default often triggers another, creating a domino effect that spreads financial distress across sectors. The enforcement system, designed to manage exceptions, is now under strain from widespread use, reflecting how deeply debt has penetrated everyday economic life.

Concordat Filings Break All Historical Records

Corporate distress has been equally severe. Concordat applications, viewed by companies as a last resort to avoid outright bankruptcy, surged to historic highs in 2025. Courts granted temporary protection (temporary moratoriums) for 2,817 separate cases during the year, marking an unprecedented volume of filings.

What makes this figure particularly striking is its comparison with previous years. The number of concordats filed in 2025 alone exceeded the combined total of 2022, 2023, and 2024, placing the year firmly at the top of all historical records. This sharp increase signals not just cyclical weakness, but a structural challenge for firms struggling to adapt to high costs, volatile demand, and tightening credit conditions.

Experts note that while concordat mechanisms are designed to provide breathing room for viable companies, the sheer scale of applications raises concerns about how many businesses can realistically recover. The backlog in courts and the strain on financial institutions further complicate the outlook, potentially prolonging uncertainty well into the coming years.

Small Businesses at the Breaking Point

Perhaps the most human dimension of the crisis is visible in the small tradespeople and artisan sector, often described as the backbone of local economies. Data from the Confederation of Turkish Tradesmen and Craftsmen (TESK) paints a bleak picture of accelerating closures and lost livelihoods.

During 2025, a total of 120,423 small businesses permanently shut down. Broken down further, this translates to an average of 330 closures per day, or more than 13 businesses every hour ceasing operations. Such figures underscore the relentless pace at which neighborhood shops, workshops, and family-run enterprises are disappearing from the economic landscape.

The longer-term trend is even more alarming. Over the past five years, 606,843 tradespeople have exited the market entirely, leaving behind a significant economic and social void. These closures not only reduce employment and local production but also weaken community cohesion and consumer confidence, amplifying the broader slowdown.

A System Under Pressure

Taken together, the explosion in enforcement files, the record-breaking surge in concordat applications, and the mass closure of small businesses suggest that Turkey’s economy is operating under extraordinary pressure. The data points to a system in which debt has become increasingly difficult to service, and in which both individuals and enterprises are running out of buffers.

While policymakers continue to emphasize stabilization efforts, the 2025 figures underscore the urgency of addressing access to financing, cost pressures, and the need for debt restructuring mechanisms. Without meaningful relief, analysts warn that the social and economic consequences of this debt crisis could deepen further, reshaping Turkey’s economic landscape for years to come.