Rising Business Insolvency Concerns
(13 December 2023 – Australia) A spike in company failures and in bad loans are looming for the Australian economy as business sentiment weakens considerably.
CreditorWatch warns a large increase in business failures is likely in 2024 as interest rate rises, stubbornly high inflation and subdued retail activity combine to raise business owners concerns as they plan for 2024.
Defaults on B2B trade payments have increased almost 60 percent since January. The number of enterprises that entered insolvency doubled year-on-year to 907 in November 2023 and is tracking well above the long term average.
“It is tough and getting tougher, and will remain tough for the foreseeable future, with small businesses going to have a difficult period ahead over the next 12 months. Come February and March we will get a clearer picture on just how many businesses will survive because December and January is when a lot of retailers and hospitality groups make their money, and if that doesn’t come through then many will have to pull the pin” commented CreditorWatch CEO Patrick Coghlan.
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