Paymex figures show a significant rise in customers becoming insolvent

Paymex Group, the UK ’s largest commercial provider of financial solutions products to the public, has seen a dramatic increase over the last 12 months in the number of customers who are becoming insolvent. Commenting on the anticipated increase in the number of people going bankrupt and entering Individual Voluntary Arrangements (IVA's) and Protected Trust Deeds, (PTD’s), Nick Pearson, External Affairs Director at Paymex, said “Looking at our statistics for the 3^rd quarter of 2008 compared with the 3^rd quarter of 2007, Paymex has seen a very significant increase in the number of people either going bankrupt or entering into an IVA or PTD. The number of people we have advised on bankruptcy has increased by some 250% over the last year. During the same period we have seen the number of IVA’s or PTD’s we have arranged for customers increase by just under 50%.”

Pearson noted “the very substantial growth in the number of people the Group has advised on bankruptcy is due in part to some lenders using minimum return rates to block people entering into IVA’s or PTD’s to repay their debts. This had the effect of pushing some people into bankruptcy even though they were keen to repay a proportion of their debts via such an arrangement. In reality, the number of people on IVA’s or PTD’s would have risen more dramatically were it not for the stance of some lending institutions. The irony is that IVA’s or PTD’s normally result in lenders being repaid a far greater percentage of the outstanding debt than in bankruptcy, where typically they will receive little or nothing.”

Pearson continued “We anticipate that as unemployment rises, the economic situation deteriorates and credit options remain difficult to obtain for most, there will be a continued increase in both bankruptcies and IVA’s numbers over the coming 12 months, probably reaching levels never previously seen before in the UK .”

Notes:

Background:

The Insolvency Service is due to publish the latest insolvency statistics for the 3^rd quarter of 2008 on Friday 7^th November. It is anticipated that there will be a significant increase in both the number of personal bankruptcies and IVA’s.

About Paymex Group:

• Paymex Group Ltd is the largest provider of financial solutions in the UK ;
• Over the last 10 years we have helped over 130,000 people to get their finances under control;
• Baines and Ernst, Blair Endersby and Buchanan Roxburgh are currently helping over 30,000 customers to repay debts to their creditors through debt management plans, Individual Voluntary Arrangements or Protected Trust Deeds;
• We have distributed over £1/2 billion to creditors;
• We broadened our debt solutions portfolio with  Buchanan Roxburgh and Baker Evans.
• We branched out into further financial services with Easycall Finance and Evolution.

For more information about Paymex see www.paymex.co.uk

For further information contact:

Nick Pearson

Director of External Affairs

Paymex Group

Lloyds House

Manchester

M2 5BE

Telephone:        0161 216 8107

Mobile: 07958 741 267

Fax:                  0161 216 8215

Email:               nick.pearson@paymex.co.uk

Home Office:     01298 210 351