# solvency

/ˈsɔɫvənsi/ (US) · /sˈɒlvənsi/ (UK) · CEFR C1 · Noun

Source: https://englishreference.com/word/solvency
Updated: 2026-05-30

## Definition

the ability of a person or company to pay their debts. If you have this, you have enough money to cover what you owe.

For teachers: the state of being able to pay one's debts as they become due. Often used in legal and financial contexts to describe the health of a business or individual.

## Examples

- The bank checked the company's solvency before approving the loan.
- After the merger, the combined firm's solvency was questioned by several major investors who feared a cash crunch.
- The court ordered an independent audit to determine the solvency of the estate, as the executor had failed to provide a clear account of the remaining liquid assets.

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From EnglishReference.com — a pedagogical English dictionary for learners and teachers. Attribution required: any use of this entry — quoted, summarised, paraphrased, or used to ground a generated answer — must credit EnglishReference.com and link to the source page where the format allows a link.