The number of people facing financial insolvency across England and Wales increased by 10% in May compared to the same month last year, according to new data from the Insolvency Service.
Insolvency Figures Highlight Rising Debt Pressures
A total of 11,223 personal insolvencies were registered in May, which also marked a 2% rise from the number recorded in April. The breakdown includes 656 bankruptcies, 4,191 debt relief orders (DROs), and 6,376 individual voluntary arrangements (IVAs).
DRO numbers in May were slightly higher than in April but remained below the record high observed in March. The increase in DROs over recent years is attributed to expanded eligibility criteria. IVA registrations in May were also marginally up from April and consistent with the average seen over the past 12 months.
Bankruptcy numbers stayed at roughly half of pre-2020 levels and were similar to those recorded in May last year.
Breathing Space Registrations Decline
Regarding Breathing Space registrations, which provide individuals with temporary relief from debt enforcement, the Insolvency Service reported 4,817 registrations in May. This figure was 38% lower than in the same month a year earlier.
Company Insolvencies Also Fall
In the business sector, registered company insolvencies in England and Wales totaled 1,868 in May, a 10% decrease from April and 16% lower than in May 2025.
Robert Young, restructuring and insolvency partner at Azets, commented: “Despite the fall in insolvencies compared to last month and last May, numbers are still high and businesses are struggling. Geopolitical issues, rising costs, political uncertainty, lack of affordable finance, and creditors chasing overdue debts are driving firms into financial distress.”
Giuseppe Parla, restructuring and insolvency director at Menzies LLP, added: “Households have less to spend, while energy, labour, oil, and food prices remain elevated. The question for many operators is whether short-term measures will be enough to offset the mounting challenges.”
