The latest Insolvency Index from Experian has revealed a positive picture for January of this year. The rate of business failures has now fallen to its lowest point since June 2007.
Businesses across the United Kingdom saw an 8% improvement in their combined financial strength score, from 79.46 in January 2009 to 81.16 in January 2010. The rate of insolvencies has fallen to 0.07% in January 2010, with seven in every 10,000 businesses going under. This compares to a higher insolvency rate of 0.09% in January 2009 and 0.11% in December 2009. Therefore in January 2010 fewer businesses shut down compared to January 2009 and December 2009.
Mr Rolf Hickmann, the managing director of pH, an Experian company, said: “It’s encouraging to discover that not since the current financial crunch started have so few firms become insolvent in a single month. Whilst it is too early to predict whether we are fully out of the woods, however this does hint at an improvement in the health of UK businesses, something which is reinforced by the financial strength view provided by January’s data.”
Here at Greengates Builders Merchants Accrington, Lancashire we hope that this low insolvency rate means we are now coming towards the end of the harsh financial times which we have been subjected to over the past months. We hope that with fewer businesses becoming insolvent this can only be a good sign for the future months ahead.