What does bankrupt mean?
Bankrupt describes a person or organization that has been formally declared unable to pay its debts, with its remaining assets administered and distributed among creditors according to law. As an adjective it can also describe something so depleted of resources, credibility, or moral worth that it has effectively failed. The word carries strong connotations of ruin, finality, and public failure, which explains its figurative uses in phrases like 'morally bankrupt' or 'intellectually bankrupt'. Its origin is vividly memorable: it comes from the Italian 'banca rotta', meaning 'broken bench', recalling the medieval practice of smashing a moneylender's trading table when he could no longer honor his obligations. Today the term appears constantly in financial news, legal contexts, and everyday talk about businesses collapsing under debt, making it essential vocabulary for understanding both commerce and public discourse about failure and recovery.
A person or organization that has been legally declared unable to pay their debts.
"The court appointed a trustee to manage the affairs of the bankrupt."
In legal contexts, plural 'bankrupts' is used mainly in historical or administrative texts; modern usage usually names individuals individually.
Having been legally declared bankrupt, or figuratively, utterly lacking in resources, value, or moral substance.
"The firm went bankrupt within two years of its founder's death."
Used chiefly in legal or historical writing referring to multiple declared bankrupts; everyday usage rarely requires the plural.
"The registry listed all the bankrupts discharged during the previous year."
The word comes straight from the Italian 'banca rotta' — literally 'broken bench' — because medieval moneylenders in Italy had their trading bench smashed in public when they could no longer pay their debts.
Reviewed by Deb Chak, Editor. AI-assisted content curated by RJS Tech Solutions LLP.
Etymology of bankrupt
Bankrupt derives from the Italian phrase 'banca rotta', meaning 'broken bench', a reference to the practice in medieval Italian trading towns of physically smashing a moneylender's bench when he became unable to pay his debts. The word entered English in the sixteenth century, carried along with other terms of Mediterranean finance. Its second element traces back to the Latin 'ruptus', meaning 'broken', the same root that gives English words like 'rupture', 'erupt', and 'disrupt'.
Related word forms
How bankrupt is actually used
In everyday speech people often use 'bankrupt' loosely to mean simply broke, though technically it denotes a formal legal status. The figurative sense — 'morally bankrupt', 'intellectually bankrupt' — is well established in journalism and criticism. In the UK, individuals are 'made bankrupt' by court order, while companies typically enter liquidation instead.
Easily confused with bankrupt
Insolvent means simply being unable to pay debts as they fall due, while bankrupt refers specifically to a formal legal state of insolvency declared through bankruptcy proceedings.