Company insolvencies increased by 19% in September compared to August, while bankruptcies and debt relief orders (DROs) also began a substantial rise.
There were 926 company insolvencies in September, compared to 778 in August, and the total consisted of 742 creditors’ voluntary liquidations (CVLs), 44 compulsory liquidations, 109 administrations and 31 company voluntary arrangements (CVAs).
There were 1,527 debt relief orders (DROs) and 1,036 bankruptcies in September 2020. This is a 14% and 34% increase on August, respectively. The bankruptcies figure comprised 963 debtor applications and 73 creditor petitions.
Using a three-month rolling average in each of the three months ending September 2020, the Insolvency Service revealed there were 4,639 individual voluntary arrangements. This is five percent lower than the rolling three-month average to the end of August, and 38% lower than September 2019.
Colin Haig, president of insolvency and restructuring trade body, R3, said: “These results show that the toll of the Covid-19 pandemic is taking on businesses and consumers may be starting to be felt in the official insolvency numbers, but the government’s support measures have reduced the size and scale of the initial impact.
“Despite the increases, today’s figures are still lower than pre-lockdown levels of insolvency and don’t fully reflect the health of businesses and the economy in the way they would normally.”