Insolvencies ‘could be on the increase’

The number of people becoming insolvent could soon be on the rise, it has been claimed.

Neil Munroe, external affairs director at Equifax, has said that this could be the case despite the country emerging from the recession, myintroducer.com reports.

He pointed to the pattern of insolvencies from previous economic downturns to predict there may be a surge in numbers over the next few months.

The industry expert cited relatively low interest rates as the reason why borrowers have been able to keep their debts in check, but warned that these rates may rise again after the election.

“For some facing this challenge, they may feel that bankruptcy is the only way out of trouble,” he remarked.

The specialist added, however, that people need to understand the full implications of bankruptcy before considering the option.

Liberal Democrat shadow chancellor Vince Cable recently warned that there is still a chance Britain could experience a double-dip recession.

By Joe Shervin