Late payment problems easing

A recent survey suggests that more than three in 10 UK businesses are finding clients are taking longer to pay than a year ago.

The survey of business owners and managers by Bibby Financial Services found that 20% of firms have chased invoices three times or more, while some 48,000 businesses have had to follow up invoices more than 11 times.

However, government figures suggest that payment times are beginning to improve and there are signs that they have now returned to pre-downturn levels.

A spokesman for the Department for Business, Innovation and Skills said:

“The government wholeheartedly agrees on the importance of prompt payment - late payment can undermine supply chain relations and confidence in the economy.

“The public sector is also stepping up to the challenge - 19 out of every 20 invoices are now paid by central department within 10 days, and in last week's Budget the government announced its intention to pay the majority of invoices within five days, whilst government contractors will also be required to pay their suppliers within 30 days.”

However, Edward Rimmer, Bibby Financial Services' UK chief executive, says:

“The UK business community has got to stem the tide. We cannot keep stalling payment and expect it to have no consequence.”

Thursday, 8th April, 2010