The firms had set aside £2.2m to deal with PPI claims and Sarah Bell and Philip Duffy of Duff & Phelps were appointed as joint administrators of the companies on February 7 2012.
The companies are subsidiaries of the Norton Finance Group which continues to trade profitably and is unaffected by this process.
A pre-pack saw another company, Norton Finance and Mortgages, buy the assets of the two insolvent firms from administration.
The firm operates out of the same building in Rotherham and will retain all the staff of the previous company.
Norton Finance Group claims all creditors will be paid and the administrators are in the process of contacting them.
But the firm admits the PPI liabilities will be dumped on the FSCS.
Keith Stringer, director of Norton Finance Group, says: “It is with reluctance we have had to close these two companies as they traded successfully for 38 years until the regulations surrounding selling of PPI changed retrospectively last year.
“However I am pleased to announce that NFM has acquired the business and all employee positions will be protected. We look forward to continuing to work with all existing introducers and partners.”
The joint administrators are currently reviewing the PPI claims liability of the Companies and are in dialogue with the Financial Services Compensation Scheme.
The FSCS is the compensation fund of last resort for customers of authorised financial services firms and is funded by a levy on financial services firms.
If the firms default on their liabilities then the FSCS will pay affected customers through the industry fund.
As a consequence of the appointment of joint administrators there is a moratorium on legal process.
This means that all consumer PPI claims have been stalled and no new ones can be initiated without the written consent of the joint administrators or an order from the High Court.