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How late payment is still hurting small businesses

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Late payment is becoming more prevalent, according to a new FSB report, with an average of 30 per cent of payments late, up from 28 per cent in 2011. 

Only 12 per cent of small businesses surveyed for the report Time to Act: The Economic Impact of Poor Payment Practice said customers always pay on time, with one in 10 saying that 80 per cent or more of payments are typically late. The average value of each payment is a staggering £6,142.

It makes the devastating consequences clear: 38 per cent hit cash-flow difficulties; 30 per cent are forced to use an overdraft; and 20 per cent say late payment has hit profits. 

The report sets out remedies, including a three-strikes-and-you’re-out rule, and a Government-backed name-and-shame policy.