Bad debt figures for 2016
According to figures from Credit Safe, the total value of bad debts issued to UK businesses in 2016 was over £920m. Despite continuing the trend of declining bad debt value in recent years, 2016 saw an increase in the number of bad debts for the first time, signifying a reduction in the value of each individual bad debt, but an increase in the frequency with which they are issued. This could indicate that smaller invoices, or invoices from smaller suppliers are going unpaid in favour of larger ones.
Source: Credit Safe UK
Looking more closely at the figures, Northern Ireland has the highest average bad debt value for 2016 of £110,876 per debt, despite having the lowest total overall bad debts issued at just 114. This suggests that a small number of businesses have filed for insolvency with a number of very large debts, skewing the average profile. Scotland had the second lowest number of bad debts issued at 761, while the North East had a very low average value per bad debt of £5,809 per debt. As expected, Greater London had both the highest number of bad debts issued at 8,389 and the highest total value of bad debts at £353m. The high density of businesses in the area means that these figures are not unusual. Looking more closely at the London statistics and despite the high values, London has been knocked off the top spot for business insolvencies, overtaken by Yorkshire and Humberside which had 5,722 closures in 2016, doubling their own regional statistics for the previous year, and comparing with 4,473 closures in London in 2016.