Turkish bankruptcy association also risks going bankrupt amid COVID-19

Serkan Alan reports: A Turkish association that helps bankrupt business owners is struggling to offer aid amid financial strains that it's suffering amid the COVID-19 pandemic, chairman Tuncer Yıldız said. The association's number of members has more than doubled during the pandemic, the chairman said.

Thursday May 20 2021 10:24 am

Serkan Alan / DUVAR

The Turkish Association of Victimized Bankrupt Business Owners (TİEMEDER) has grown more than double in size since the start of the COVID-19 pandemic, and now risks bankruptcy itself as their resources fall short of the demand for aid, chairman Tuncer Yıldız said.

The association grew from 2,000 members in 2019 to more than 5,000 in 2021, Yıldız noted, adding that they're having a hard time returning to calls.

"We were just trying to help out bankrupt business owners, but we were met with a storm when business owners who shuttered their stores during the pandemic started asking for our help," the chairman said.

"We were merely bankrupt business owners who founded an association, which is also on the cusp of bankruptcy. Our resources are limited and we're struggling to help people out."

The largest majority of applicants to the association have been owners of restaurants, entertainment venues, and food places, whereas beauty parlor owners and owners of non-chain stores in shopping malls followed closely.

"Our phones have not been quiet in the past two years. Most recently, people have simply been shuttering their businesses because of the full lockdown," Yıldız said.

The increase in the number of applicants has shrunk the share of aid they can offer to each petitioner, Yıldız noted, adding that thousands of business owners declare bankruptcy each month.

Many applicants suffer from thousands of liras in monthly rent payments, but the association can only offer legal counseling at this point, the chairman said.

"The state gave out aid for rent payments, but it was insignificant considering the sums that people owe banks and landlords," the chairman noted.

The biggest downfall during the pandemic has been the lack of alternatives they can offer bankrupt business owners, Yıldız said, noting that they used to suggest applicants find employment in other sectors before the pandemic.

The government's aid to business owners is a mere drop of water in the face of a raging fire, the chairman said,

"There are no business owners today who can say 'state aid remedied my financial troubles,'" Yıldız said. "The state is also lacking funds, so they can only help so much. That's the dilemma."

Business owners in Turkey need morale, and for consumers' purchasing power to grow, Yıldız noted, urging the state to offer more extensive aid programs for the public.

Topics bankruptcy