Corporate insolvencies soar by a third to highest level for three years

Corporate insolvencies soared by 37.7% in March to their highest level for three years, according to figures from the Insolvency Service.

Carly Davies, our Debt Control Manager provides an update.

There was a total of 2,457 insolvencies in March 2023 compared to February’s total of 1,784.

That was a 15.9% increase compared to March 2022’s figure of 2,120. 

Corporate insolvencies increased by 145.9% from March 2021’s total of 999 and by 99.3% from March 2020’s total of 1,233.

The statistics show there was an increase of 55.4% compared to pre-pandemic levels in March 2019 (1,581).

Christina Fitzgerald, President of R3, the insolvency and restructuring trade body, said the rise was driven by increasing numbers of Creditors’ Voluntary Liquidations, which are also at a three-year high.

She said: “Business owners have spent three years trading through a pandemic and economic uncertainty, and an increasing number are choosing to shut their businesses before that choice is taken away from them and as the turbulent trading climate proves too much.

“Businesses across Britain are struggling at the moment. Costs continue to rise at a time when consumers are cutting back on discretionary spending, and when staff are requesting pay rises to cover their bills. 

“With the Government’s Energy Bill Relief Scheme ending at the end of March, many businesses will be facing further increases in costs at a time when they can ill-afford them. 

“Directors need to be vigilant about the signs of financial distress and seek advice as soon as they spot issues with their business or begin to worry about its finances.

If you would like more information about this article or any aspect of debt collection or credit control, please contact Carly on 01228 516666 or click here to send her an email.