Kurkime modernią Lietuvos ateitį kartu


Ministry of Social Security and Labor of the Republic of of Lithuania

Implementation of over-indebtedness solutions

6 March 2023 - 6 September 2023


According to the Chamber of Bailiffs, the total amount of debt claims in 2022 was €5.4 billion, but only €225.3 million has been recovered a mere 4.1% of the total. Moreover, debts have grown 10 times faster than debt collection in recent years, with the number of debtors reaching 206,000. One of the reasons for this is that as many as 69% of debtors have no income and do not receive pensions, which means that most of the debts cannot be collected. The solutions so far have been characterised by the ‘stick’ principle, with high recovery tariff rates and expansion of powers for bailiffs to enforce debt recovery. Foreign best practice shows that punitive tactics do not work because they do not tackle the problem at its root. On the contrary, this strategy leads people to despair, unemployment and the informal market. This is confirmed by the focus groups with social workers and case managers during the first Create Lithuania rotation debtors do not have enough income to live on after deductions, so it is more feasible to work illegally or rely on social benefits. This leads to a significant increase in public social costs, risks of social exclusion, mental health problems and suicide, rising unemployment and decreasing debt recovery.

In his second rotation, Rokas Keršys will continue his work at the Ministry of Social Security and Labour, raising the visibility of debt issues in society and developing evidence-based solutions to prevent over-indebtedness. This project will focus on amendments to the Code of Civil Procedure aimed at balancing the system of wage and asset recovery in such a way that debtors have greater incentives to work and maximise their income in the formal labour markets, but reduce the risk of homelessness for debtors. A debt moratorium system for debtors returning to the labour market is also proposed to give debtors time to reintegrate into society, build up savings, and manage their budgets and financial obligations. Finally, a live monitoring of data on debtors is being developed to enable stakeholders to formulate data-driven policies, thus eventually shedding light on the depth of the debt problem in Lithuania.


The project aims to address the problem of over-indebtedness by providing incentives for debtors to re-enter the labour market. To achieve this goal, the following steps are taken:

  • Draft amendments to the Code of Civil Procedure, including a reduction in the rates of deductions from wages; a finer segmentation of income brackets aimed at better reflecting the solvency capacity of debtors; and an increase in the protection of the debtor’s last home against foreclosure.
  • Debt moratorium proposal for debtors returning to the formal labour market.
  • Expanding availability of data on debtors and creditors, which will be achieved through a one-off analysis of the data collected, and a live data monitoring toolkit.

Project progress


Solutions one-pager


Asset deduction system changes one-pager


Income deduction system changes one-pager


Debtors data analysis


Debt moratorium proposal


Live debtor data access proposal


Code of Civil Procedure change descriptions


Rokas Keršys
Rokas Keršys

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