The number of firms going out of business is at its lowest in a year, according to the latest Insolvency Index from Experian.

The index shows that 0.09% of UK businesses failed during August this year, up on the 0.08% recorded in August 2008 but down on the 0.11% recorded in July.

However, the number of small firms with 11 to 25 employees saw a marked increase in insolvencies during September.  The rate of insolvencies among this group rose from 0.21% in September 2008 to 0.26% in September 2009, the biggest year-on-year increase seen by any business type.

The total number of small business insolvencies within September increased year-on-year by 19%.

Rolf Hickman, managing director of pH, an Experian company, says: “A flat insolvency rate in September coupled with a small improvement in the overall financial solidity of the business population is positive.  August can be a slow month for insolvencies, which may have explained the low insolvency rate, but the fact that the low rate has continued into September is a good sign.”