An increase in the number of bankruptcies in England and Wales has sparked concerns that consumers do not realise the full impact of declaring themselves bankrupt, according to the UK's largest credit agency.

Recent figures from the Insolvency Service revealed there were 15,389 bankruptcies at the start of 2006, an increase of 73.4 per cent on the same time a year ago.

Choosing bankruptcy as a way of dealing with debts will certainly impact on an individual's ability to obtain credit in the future and should be considered as a last resort, sought under professional financial advice, claims Experian.

Even after bankruptcy, a company may refuse a customer credit simply because they have been bankrupt in the past, or they may charge a higher interest rate considering them a high-risk, it may also affect the chance of renting a home or getting a particular job.

"We are concerned that people don't realise their credit report will not be wiped clean after one year. A bankruptcy order will still appear on their credit record for six years," said James Jones, consumer affairs manager for Experian.

In some situations, individuals who are deemed to have acted fraudulently or recklessly can be left with a Bankruptcy Restriction Order valid for up to 15 years.