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1 in 2 UK SMEs affected by late payments ahead of Christmas

14th Dec 2017
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Sage presents the results of its research into late payments and their impact on small and medium businesses.

Sage has surveyed more than 3,000 small and medium enterprises (SMEs) across 11 countries, to uncover the true impact of late payments and the barriers to chasing payments.

The main results show SMEs around the world are greatly affected by this situation:

  • 17% of all invoices to small & medium businesses are paid late in the UK and Ireland
  • Globally, 1 in 10 invoices are paid late
  • 9% of UK’s late invoices are written off as bad debt
  • In 2017, UK SMEs have spent on average 15 days chasing late payments

The reason behind late payments

In the UK, the most common excuse for payments being late is that the payment has already been made and the transaction is still pending (44% of respondents).

On the other hand, the main barrier to chasing late payments is the fact that raising the issue with their clients could jeopardise future relationships followed by the lack of dedicated resources to chase those payments.

How to reduce the impact of late payments

Businesses could see a significant improvement in timely payments if they establish and communicate strict payment terms from the start.

Additionally, automatic payment methods, such as direct debit, can make the whole payment process easier and quicker for the payer. With these systems, payments are reconciled into your account from the moment the customer initiates the transaction.

Click here to read the full report and find out more about avoiding late payments.

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