ECONOMY

Bad checks, unpaid bills of exchange stifling the market

Rubber checks soared by over 43 percent year-on-year in the first seven months of 2011, asphyxiating the market further as credit lines continue to dry up.

Data released yesterday by the Tiresias bank information system showed that bounced checks in the year to July amounted to 1.38 billion euros, up by 43.3 percent from the same period in 2010, while unpaid bills of exchange rose to 86,257 units, totaling 134,476,048 euros and representing a 6.47 percent increase compared to last year.

Given the growth in bad checks and the deepening recession in the real economy, it is almost certain that their total amount will exceed 2 billion euros by the end of the year.

A survey by the General Confederation of Greek Small Businesses and Traders (GSEVEE) has shown that just under half of the companies that make transactions through checks possess checks that have already bounced (37.9 percent) or are at risk of doing so (7.3 percent).

This phenomenon, which is set to grow, is causing a chain reaction in the market as it is also threatening the existence of healthy enterprises.