Annual business insolvencies rate falls in 2010

In 2010 the annual rate of business insolvencies fell for the first time in two years as the financial health of UK businesses improved, according to the latest Insolvency Index from Experian, a global information services company.

1.04 per cent of UK businesses failed in 2010, compared to 1.25 per cent in 2009, the first annual drop for two years; while the total number of insolvencies decreased from 24,209 in 2009 to 19,946 in 2010 – an 18 per cent drop.

March 2010 saw the greatest number of insolvencies for the year, when 0.11 per cent of the total business population failed, but from then on the failure rate saw a general improvement, hitting an annual low of 0.07 per cent in August and again in November. 

The UK’s business community finished 2010 stronger than it started the year, as the average financial strength score of UK businesses fell from 81.16 in January to reach its lowest point of 80.70 in May, but then recovered to reach 81.35 in December.