Small firms face £9k bill to collect late payments
Small firms on average face a £9,000 bill to collect late payments.
Annual research by BACS Payment Schemes shows that small businesses in the UK face a bill of £6.7bn to collect money they are owed by other companies, up from £2.6bn in 2017.
The cost, based on staff time and interest on borrowing, comes to an average of £9,000 for each firm.
The report showed that £13bn was outstanding to the country’s 5.7m SMEs, compared with £14bn last year, and more than a third are waiting two months beyond agreed terms for payment, up from a fifth last year.
The number of SMEs experiencing late payments overall increased from 37% in 2017 to 43% in 2018.
The average amount owed was £17,000. Over a quarter of SME owners surveyed said they in turn had been forced to withhold payments to suppliers, and 28% have had to lower their own salaries to conserve cash.
What to do about late payment
The Credit Protection Association cares passionately about late payment.
We have helping business get paid for over 100 years. CPA prompt punctual payment!
If this is is an issue that affects you, contact us to see how we can help.
The problem of late payment has been debated, dismissed and argued over for far too long. As the story above shows, the prompt payment code is not the answer. Big business pays it merely lip service.
Various initiatives such as the Prompt Payment Code have been ultimately ineffective and proved that merely asking businesses to promise to pay on time has not a successful tactic.
Sadly stronger tactics are called for.
At the Credit Protection Association, our debt recovery services chase down unpaid invoices and residual debt, freeing up cash flow that our members utilise for expansion projects or to build up their savings.
Furthermore, our credit management products protect our members from further harm, with our credit checks and company directories purging business finances from harmful figures.
At CPA, we also fight to get our members rightly compensated in accordance with the Late Payment of Commercial Debts (Interest) Act 1998, unlocking hidden cash and potential in our members and their prospects.
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0330 053 9263
The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!
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