UK insolvencies are rising again and creditors must act early

The UK insolvency landscape has shifted again with the latest figures from the Insolvency Service showing a clear increase in company failures. More than two thousand six hundred businesses entered insolvency in October. This represents a twelve percent rise from the previous month and continues a long running pattern of financial strain across many sectors.

Construction, hospitality and manufacturing remain particularly exposed. Higher financing costs and weak trading conditions have left many businesses short of cash. Delay in collecting overdue invoices often makes the problem worse.

The FCA has also raised concerns about arrears management in the financial sector. While the report focuses on regulated lenders, the lessons apply broadly to corporate credit. A strong policy is not enough. The follow through must be consistent and fair.

A recent High Court decision has made it harder for debtors to avoid statutory demands by refusing to engage. Reasonable attempts at service are likely to be accepted by the Court. This gives proactive creditors a stronger position when dealing with deliberate avoidance.

Credit teams should tighten terms, review their highest risk accounts and move quickly when communication stops. The most successful recoveries we see at Athena come from early action, not last minute escalation after months of promises.

If your aged debt list has grown over the last quarter, now is the moment to prioritise.