The Insolvency Service has published its monthly report, which includes critical information on people and businesses facing financial difficulties and undergoing insolvency proceedings.
In September 2023, the number of company insolvencies registered was 1,967, 17% higher than the previous year's figure of 1,688. This figure is also higher than the levels observed during the Government's support measures in response to the COVID-19 pandemic and higher than the pre-pandemic numbers.
Of the 1,967 registered company insolvencies in September 2023:
The number of compulsory liquidations, CVLs and administrations was higher than in September 2022. The increase in company insolvencies has been driven chiefly by CVLs. In contrast, compulsory liquidation and administration numbers have increased from historically low numbers seen during and immediately after the pandemic, returning to close to 2019 levels.
Figure 1: The number of registered company insolvencies in September 2023 was higher than in the same month last year, driven mostly by a higher number of CVLs. Company insolvencies, England and Wales, September 2019 to September 2023.
For individuals, the total number of insolvencies in September 2023 was 7,271, 27% lower than in the same month in the previous year (10,024 in September 2022).
The individual insolvencies consisted of:
In September 2023, fewer individual insolvencies were recorded compared to the same period in 2022. This was mainly due to a decrease in the number of registered IVAs. The number of approved IVAs registered in August and September was relatively high, contributing to this decrease, as many of these registrations were late.
Despite higher DRO and bankruptcy numbers, IVA figures in 2023 decreased compared to the record highs of 2022, with bankruptcies remaining below pre-2020 levels.
Figure 2: IVA numbers so far in 2023 have been lower than the record-high numbers in 2022, while bankruptcy and DRO numbers were higher in September 2023 than in the same period last year.
CoCredo MD, Dan Hancocks, says: “Businesses face a challenging trading climate due to reduced spending on non-essential items, which has increased the cost of running a business, which is expected to rise further with the onset of colder weather and the higher costs of borrowing and servicing debts.
If you're a company director and feeling worried about your business, our message to you is straightforward - seek advice. Starting this conversation can be challenging, but it is better to do it when your concerns are new rather than waiting until they have spiralled out of control. Seeking early advice can give you more options and time to decide on the best course of action.
More businesses are using Creditors' Voluntary Liquidations to wind down, while more creditors are resorting to Compulsory Liquidations to recover debts.
Directors should be vigilant for any indications of financial distress within their business and seek advice promptly. If there are concerns regarding suppliers or the company's financial state, please feel free to contact us for assistance.”
Our Monitoring service is designed to help UK and International companies stay informed about any changes in their financial performance. This service provides valuable insights that can help protect your business. You will receive email notifications for one year about any developments, such as payment history, financial performance, and county court judgments. This way, you can take proactive measures if necessary and make informed decisions about your business.
Would you like to try our company's credit check service for free? Our credit reporting services can help you reduce your credit risk and improve your cash flow and productivity. To learn more, please don't hesitate to contact us by calling 01494 790600 or emailing us.