Nearly 60,000 British businesses could go bust next year, with a raft of insolvencies particularly affecting small and medium sized businesses, according to recruitment firm Begbies Traynor.

Around 20,000 job losses were announced last week by firms including BT, Virgin media and RBS.

Begbies Traynor’s latest insolvency monitor reveals that over 57,000 firms are experiencing significant financial problems, with just under 2,000 on its critical list – meaning there is a strong possibility they will go bust in less than six months.

This figure is a 7% increase from this time last year.

SMEs account for around 90% of the firms in financial difficulties and experts have warned that a large proportion of small businesses could soon cease trading.

“I can see a tsunami of insolvencies among SMES in the New Year unless firms can conserve cash now,” said Nick Hood, senior partner at Begbies Traynor.