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Insolvency data April 2025: "This insolvency storm is 2025’s economic wake-up call"

ended 20. May 2025

In April 2025, 10,012 individuals entered insolvency in England and Wales. This was 8% higher than in March 2025 and 4% higher than in April 2024, according to Insolvency Service data published this morning. Meanwhile, the number of registered company insolvencies in England and Wales was 2,053 in April 2025, 3% higher than in March 2025 (1,996) but 5% lower than the same month in the previous year (2,163 in April 2024). Newspage asked financial experts for their views, below.

6 responses from the Newspage community

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Gabriel McKeown
Political & Economics Writer at Sad Rabbit - Substack Newsletter
With individual insolvencies surging, April’s figures are not yet an earthquake, but they are the unmistakable rumble of pressure building beneath the surface. Debt-relief orders accounted for the lion’s share of new cases, underscoring that it is the most fragile borrowers, those without property or meaningful savings, who are first to buckle beneath the still elevated base rate. Furthermore, history offers a cold comfort, as individual insolvencies tend to peak in the months prior to corporate failures accelerating, reflecting how job losses and falling consumption eventually drain undercapitalised businesses. Looking ahead, the economic outlook remains uncertain, and there is a pressing need for the government to address the immediate challenges faced by struggling individuals and small businesses.
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Michelle Lawson
Director at Lawson Financial
These figures are never pleasant reading and to still see people going insolvent shows there is a greater problem. There is also a question to be asked if everyone entering this has looked at all options available to them as I have seen a couple of people recently swept along this route when there were alternatives. Seeing companies close is also still very sad to read as a lot of these will be decent viable businesses who just can't continue with the rising costs of keeping it running and increasing staffing costs.
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Bob Singh
Founder at Chess Mortgages
The latest insolvency figures reveal that many are still reeling from the effects of Covid 19 as well as the spike in the general cost of living. Government fiscal policies have not helped consumers or businesses at a time when wages have not kept up with inflation. This trend will continue due to external geo-political factors not least the tariffs imposed by the USA, which will undoubtedly hurt our economy. Many employers will be tightening their belts by shedding staff to lower their cost base. However, with lower interest rates potentially on the horizon and a new deal with Europe, there is still hope for better times ahead. But we're not out of the woods yet.
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Tony Redondo
Founder at Cosmos Currency Exchange
This insolvency storm is 2025’s economic wake-up call. Individuals are being crushed by a 9:1 housing cost ratio, rising inflation and unemployment, and a flatlining economy. Companies are battling with awful April’s tax rises and tariff increases. The Insolvency Service flags wage stagnation as a core issue. Consumers face mounting debt in a 0.75% growth economy, risking deeper financial ruin. Meanwhile, SMEs, who are being hit hardest, are shedding jobs, threatening livelihoods. Recession is not off the cards if trade woes and costs aren’t addressed. This isn’t a blip—it’s a red alert for urgent action to shield the vulnerable and bolster the UK’s fragile economy.
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Keith Budden
Managing Director at Ensurety
It's always distressing to see the number of personal insolvencies go up - today's figures are a clear indicator that the 'cost of living crisis' is still far from over. March always gives consumers a little bit of a breather, since if they've paid all of their council tax instalments by February, then March gives them that little bit extra 'spare' money. April offers no such reprieve, plus for many it sees the arrival of their annual water bill and so the added pressure causes already weakend branches to snap.

For business, while the number is higher than March which is not unexpected, it does show that maybe the widely predicted NI rise tsunami is not as much of a spectacle as it was predicted to be (yes we know redundancies are up across the board) but if the core company survives, that always offers the opportunity that their fortunes will improve and they will re-employ people to new vacancies.
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Patricia McGirr
Founder at Repossession Rescue Network
Britain’s debt timebomb isn’t just ticking. It’s already blowing up in homes and boardrooms alike. A surge in personal insolvencies like this screams of households on the brink. Wages are stagnant, debt help is patchy, and one surprise bill can sink a family. The drop in company collapses isn’t a win. It’s a warning. Zombie firms are shuffling along, but for how long? We need rapid local debt triage hubs, not faceless websites and endless call queues. The Government needs to stop trumpeting figures to suggest the economy is healing. Under the surface, a financial cancer is spreading and we’ve no effective treatment plan in place.