Business insolvencies in January 2013 reached their lowest level since June 2007, credit experts Experian have revealed.
According to the global research company, the data shows that 0.06% of the business population (1,271 companies) failed in January 2013. This marks a fall from 0.07% in January 2012 and down from 0.08% at the end of last year.
The UK's mid-sized companies saw the biggest fall in insolvency rates in January 2013, as businesses with between 26-50 employees and 51-100 employees, experienced a fall from 0.20% in January 2012 to 0.14% in January this year and 0.14% to 0.07% respectively.
The largest firms, with more than 501 employees, saw their average insolvency rate fall from 0.20% in January 2012 to 0.15% in January 2013.
The UK's smallest businesses - comprising two or fewer employees - saw a slight fall in the insolvency rate compared to figures at the end of last year; however the picture for businesses with less than 10 employees remains broadly flat.
Experian's business information services managing director for the UK and Ireland, Max Firth, said that although January is typically a slow month for business insolvencies, the figures for the month 'do show a marked decline in the insolvency rate, which in fact has hit its lowest level for over five years'.
'This follows a relatively stable 2012, which itself was an improvement on the previous year. High-profile insolvencies so far this year show that it is still a challenging climate and businesses across all sectors and sizes need to adapt to changes in their trading environment.
'Businesses who want to secure the right deals, contracts and finance in order to grow this year need to ensure they are in the best position possible financially; this means thinking about their own credit rating and assessing what it says about them,' said Firth.
The most significant falls in insolvency emerged from Scotland, with 0.03% of the business population failing. This follows the steady downward trend that Scotland experienced throughout 2012, followed by the North East, East Midlands and West Midlands.Of the top five biggest sectors, building/construction and leisure/hotels exhibited modest falls on January 2012's figures.
Business services held firm at 0.06%, while property and IT saw an increase on last year - from 0.04% for property and 0.03% for IT to 0.06%.