The Covid stimulus measures introduced have had a drastic effect on the number of insolvency and winding up procedures. In October 2020 there was a total of 856 company insolvencies in England and Wales, comprised of:
- 672 creditors’ voluntary liquidations (CVLs)
- 59 compulsory liquidations
- 104 administrations
- 21 company voluntary arrangements (CVAs)
- 0 receiverships
The overall number shows a decrease of 42% on October 19, driven by a decrease in CVLs and CVAs which fell by 36% and 72% respectively.
The drastic reduction in procedures has primarily been ascribed to the Covid stimulus measures in place. It can be assumed that 2021 will see this trend corrected as the Government stimulus packages will cease, cash flow will be king during this time and the ability to trade and pay whilst avoiding delays may be the difference in becoming a stat in the insolvency world or a survivor.
We will not always have a furlough scheme, Government stimulus packages or top-ups to come to our assistance. Cashflow issues can come about quickly and without adequate cash flow, a business can struggle to stay afloat.
During these uncertain times, it is more important than ever to get a handle on your cash flow. Invoice Finance is an increasingly popular form of finance, with over 80% of intermediary respondents in a survey by Bibby Financial Services recommending invoice finance to clients.
To discuss the funding options available to your business. Please do not hesitate to contact us on 0161 280 4220 or firstname.lastname@example.org
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