Late payments ‘endemic problem’ for SMEs
Apr 15 2010
“SMEs are getting left empty- handed”
The majority of small businesses say late payments have damaged their cash flow situation.
Some 71 per cent of SMEs have suffered from late payments in the past 12 months, according to a survey from RBS and Natwest.
The study estimates that in the last year a total of £62 billon was owed to businesses in bills paid beyond agreed deadlines. Of this, around £15 billion was more than 120 days overdue.
Peter Ibbetson, chairman of small business banking at RBS, says: ‘Bad debts and late payment of invoices are endemic problems for UK businesses.’
Stephen Alambritis, head of public affairs at the Federation of Small Businesses, adds: ‘Poor payment practices can drastically affect cash flow for small firms at a time when business owners are doing their best to hold on to precious funds.’
This follows a survey from the Forum of Private Business, which found small businesses currently have an average of £47,000 tied up by late payments.