The latest data from The Insolvency Service shows IVAs increased by a third, on average in the three months to June, while creditor bankruptcies have fallen by 90%.
The data published today (July 14) shows there were 8,428 IVAs registered on average each month, during the three months leading up to June 2020. This was a 33% increase on the same time frame in 2019. However, The Insolvency Service highlighted that these numbers may be artificially higher due to a technical issue experienced in May.*
The trend in IVAs followed a similar pattern in the three months to May.
In June in England and Wales, there were 454 bankruptcies. This comprised 431 debtor bankruptcies and 23 creditor bankruptcies. This is a 65% reduction in bankruptcies overall on June 2019. Creditor bankruptcies in particular fell by 91% compared to June 2019.
The Insolvency Service states that the fall in creditor bankruptcies will likely have been partly due to reduced HMRC enforcement activity, in combination with reduced running of the courts during lockdown.
The data also showed there were 1775 debt relief orders (DROs), a 15% reduction on the same month on the year prior.
According to The Insolvency Service, the fall in DROs corresponds with a drop in applications for those services.
The Insolvency Service also published data today on the number of corporate insolvencies in June.
* The Insolvency Service explained that technical issues when registering IVAs related in part to the time lag from an IVA being accepted and the date its registered against an insolvency practitioner. IVA statistics were also affected by technical issues experienced by an IVA provider, with nearly 5,000 IVAs that would have been registered in May 2020, that would otherwise have been registered between December and March.