Smaller firms are feeling the pinch more

 
Marion Dakers
LY 2

LY 2,000 British businesses collapsed in May, according to figures from Experian.

The rate of insolvencies was stable compared to a year ago at around 0.09 per cent of the overall business population, but the stats showed that firms with between six and 10 staff saw the biggest rise in failures.

Experian’s Max Firth said: “By the time a firm grows to six to 10 employees, the flexibility it benefited from as a micro business begins to disappear.”

Separate research from Syscap showed that the interest rate on small business loans barely budged in April, suggesting the National Loan Guarantee Scheme has not yet cut loan costs.

The scheme, launched in March, allows commercial banks to borrow more easily in an attempt to increase the flow of loans to businesses.

But Syscap said that in April the cost of an average business loan for less than a £1m barely changed at 3.71 per cent.