SCOTLAND has witnessed the largest decline in the volume of business bad debts in the UK over the last three years.
Incidences of unrecoverable monies following company liquidations fell by 36 per cent, from 1,139 in 2013 to 733 in 2015, according to analysis by business credit report firm Creditsafe.
From 2013 to 2014 there was a 22 per cent reduction, which slowed to 17 per cent between 2014 and 2015, corresponding with a reduction in the number of businesses entering liquidation.
The total value of bad debt left to UK firms, after companies were liquidated, totalled £4.2 billion in 2015.
Overall, the volume of bad business debts left to companies after a firm is liquidated fell nine per cent last year.
Across the UK, the volume of this type of bad debt has fallen by a quarter since 2013, from a peak of 55,369 to 41,328 last year. This represented 1.77 per cent of all bad debt cases of this type. This was down from two percent in 2013, meaning that not only are these bad debts improving at a faster rate in Scotland than anywhere else, but that Scotland’s share of the burden is also falling.
“Credit checking and due diligence is aiding the business world in terms of protection for trading businesses,” said David Walters, data director, Creditsafe UK. “The economy as a whole is improving and we believe that proper due diligence and credit checking has had a large influence on this.”
Businesses located in Greater London have faced the greatest volume of exposure to bad business debts in the last three years, but the number has fallen by more than a third in the last two years to 6.538 – representing 15.8 per cent of all cases of this type.
The north-west is the only UK region where the volume of these bad debts increased last year.
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