Tuesday 17th of November 2009
Small business owners are working more hours just to prevent their company from going bankrupt, according to Santander, but could end up in need of financial help themselves - possibly in the form of an individual voluntary arrangement (IVA).
The number of insolvencies rose by 39 per cent in the second quarter of 2009, compared with the same period in 2008.
According to the banking group, the average small business owner now works 47 hours a week in an effort to prevent their firm from joining that statistic.
But the harsh economic climate means that an increasing number are unsuccessful in their quest and could take desperate measures as financial disaster looms.
Businessmen who take on unsecured personal credit to prop up an ailing business may find that an IVA could be the best way to start repaying what they owe and avert the need for bankruptcy.
IVAs can renegotiate repayment amounts with creditors to make payments more affordable to debtors and could prevent the loss of the family home - something that may be possible when filing for bankruptcy.
By Neil Burton
- House price rise 'may not indicate recovery'
- Equity release 'needs to be increased'
- Need for IVA help could increase as expert predicts reduction in lending
- Government announces 'breathing space' for those needing IVA help
- Lack of subprime lending creating need for IVA help, expert suggests
- IVA answers to benefit those in insolvency hotspots?
