The number of business insolvencies is declining, according to the latest Insolvency Index from information services firm Experian.

The total number of insolvencies fell by 15.1% in February compared to the same month last year - from 2,160 in February 2009 to 1,834  in February 2010, bringing the rate of insolvencies down from 0.11% to 0.10%.

However, the insolvency rate rose in January (0.08%).
 

Rolf Hickmann, managing director of pH, an Experian company, says: “Small businesses have far more flexibility than any other business type.  It is easier for smaller businesses, with just one or two employees, to easily make adjustments to their operations and pull in the reins when times are difficult.  For larger business, there is the security that comes with size and a well established structure, so insolvency rates among these business types are also low. 

“However, mid sized businesses, which are seeing the highest rates of insolvencies, are too large to be flexible and too small to rely on a strong and established structure.