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UK firms issuing fewer wind up petitions 19 April 2011

This is despite 66 per cent saying they are taking a tougher approach to debtors, according to a new poll by credit intelligence firm Graydon UK.

The research showed 88 per cent of credit managers are using alternative measures to winding up petitions.

The most popular method used is country court judgements, which were implemented by more than half (55 per cent) of those surveyed.

Head of external affairs at Graydon Martin Williams said: “This indicates when it comes to the crunch and creditors start to turn the screws debtors can and do pay up.”

He added: “This may well be because, contrary to previous recessions, many businesses have been able to draw upon support from the government via HMRC’s time to pay scheme, freeing up cash to pay off their creditors.”

Williams went on to say that this, combined with the 10-day payment pledge and low interest rates, has allowed businesses to make paying off suppliers a debt priority.

He believes these policies have helped to reduce the volume of insolvencies during the recession.

The survey also showed 42 per cent of businesses had contracted third party debt collectors and 39 per cent had set up formal voluntary arrangements with debtors.

For the poll Graydon contacted 470 professional credit managers.



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