Insolvencies fall to lowest level in 10 years
29/04/2015
The numbers of insolvencies in England and Wales have fallen to their lowest rate in almost a decade.
Figures from the Insolvency Service have shown that 20,826 people became insolvent in the first three months of the year, which is the lowest figure since autumn 2005. It works out as a fall of 18.6% compared to the first three months of 2014, which is one of the steepest declines on record.
The number of companies becoming insolvent also fell. In the first three months of 2015, 4,052 companies went bust, a drop of 11.3% on the same quarter last year and the lowest figure since the autumn of 2007.
Insolvencies include bankruptcies, debt relief orders and individual voluntary arrangements (IVAs). IVA’s, which is the most common form of insolvency, fell by 23.5%.
The reason for the fall is linked to the lack of consumer borrowing following the 2008 financial crisis. Seven years later, fewer people are in financial difficulty as fewer loans and credit cards were sold.
Peter Tutton, head of policy at StepChange said:
"With levels of personal borrowing growing rapidly once again, the next government and lenders must ensure that the mistakes of the pre-crisis credit boom are not repeated.
"Our concern is that growing levels of consumer credit will be followed by growing numbers of people falling into problem debt."
Need financial Advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245, or by arranging a visit.
Share this..
Related stories
Coalition government set to increase bank loan targets
It is believed that the Conservative/Liberal Democrat coalition government is looking to increase loan targets previously set by the Labour government. While bank shares heaved a sigh of relief today with many believing that plans by the new government could have been far harsher there is still some concern about a potential banking levy, legislation to control remuneration as well as the likely i...
Read MoreBank of England reports massive debt write-offs
The Bank of England has today reported that between April and June 2010 UK banks and building societies were forced to write-off £3.5 billion of UK consumer debt. This equates to a massive £40 million each and every day during this period as more and more families and individuals face up to the fact they will be unable to repay large chunks of their debt. So what does this mean for the future?...
Read MoreMiddle class areas 'most in debt'
It was revealed today, in a report from a credit rating agency, that middle class families across the UK are the most likely to be in heavy debt - with many middle class families reported to be in debt of up to £50,000. Additionally, those living in wealthier areas such as London and the South East have on average four times more debt than those in less prosperous areas, such as Scotland and some...
Read MoreJaguar Land Rover secures further funding
In what is becoming an embarrassing situation for the UK government, which has over £2.5 billion to hand to help the UK car industry, Tata Motors (the parent company of Jaguar Land Rover) has today announced a £175 million loan from the State bank of India. The company now has around £500 million in additional finance available from a number of banks and financial institutions around the world....
Read MoreIncreasing number of loans used for consolidation
An increasing number of borrowers are taking out personal loans to consolidate their existing debts, according to an expert from Sainsbury's bank.According to statistics from the debt charity, Credit Action, total personal debt in the UK came to £1,355 billion at the end of July 2007 - a 10.1 per cent increase on last year. Steve Baillie, head of loans at Sainsbury's Bank, said that while loans f...
Read More