I took out a personal loan in 2017 for £1,000, and after a few months I stopped making payments. Then in 2019 the loan company went bust. Today I received a letter from the administrators for the company demanding payment in full or they will take me to court.
Can they do this? The company went bust.
Just because a lender goes out of business does not relieve you of the debt, you still owe the money.
So yes, the Administrators for the loan company can collect the account, and use whatever collection tools available to them, including the courts.