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Small businesses suffering most due to late payments

Published on 15 Apr 2010 under category: legal

UK businesses have waited on £62.87 billion in late payments over the past 12 months, according to new research.

NatWest and RBS found that almost three quarters (71 per cent) of firms surveyed had waited to be paid, with just over one in ten experiencing late payments 60 per cent of the time.

Small businesses were most likely to bear the brunt of delayed payments, with one in five having to manage tardy debtors.

In order to address the problem ahead of the credit crunch, the Department of Business and Industry launched the Prompt Payment scheme in 2008, which provided guidelines on payment practices for companies.

On the report findings, Peter Ibbetson, the chairman of small business for Natwest and RBS, said that small businesses were failing to take advantage of the number of short-term credit solutions available to them through banks.

Among them are 'cash injections' to cover the value of unpaid invoices and the use of banking services to chase after debtors, which could provide relief for time-strapped firms.

If you require advice on Insolvency and Bankruptcy please call us on +44 (0)20 7831 0101 and ask for Katherine Sillett.