Business insolvencies in the UK have hit their lowest point since June 2007 as the financial strength of businesses improved 8% year-on-year in January 2010, according to Experian.

The rate of insolvencies fell to 0.07% in January 2010, as only seven in every 10,000 businesses went under. This compares to an insolvency rate of 0.09% in January 2009 and 0.11% in December 2009.

Rolf Hickmann, managing director of pH, an Experian company, said: “It’s encouraging to discover that not since the current financial crunch started have so few firms become insolvent in a single month. Whilst it is too early to predict whether we are fully out of the woods, this does hint at an improvement in the health of UK businesses, something which is reinforced by the financial strength view provided by January’s data.”

Businesses in the South West continued to be the most robust, holding the best financial strength score during January 2010 whilst those in the Yorkshire witnessed the highest rate of failures at 0.13%.

The North East saw its insolvency rate decrease by over 30% from 0.19% to 0.12% in January, as it lost its position as the region with the highest rate.