Online database shames late payers

Francois Badenhorst
Practice correspondent
Sift Media
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A new tech start-up hopes naming and shaming late payers can help cure Britain’s small business debt recovery epidemic.

Chris Hawthorn started the PACT (please abide contract terms) scheme after his property marketing business buckled under the weight of late payment.

“I was deeply affected by late payments and non-payments. It’s not just about the money. It’s the ancillary effects: it’s the loss of productivity due to time spent chasing debts. I couldn’t attend exhibitions or hire new people,” he said.

To join the PACT scheme, a business pays a monthly £10 pound fee. The member business is then allowed to use PACT’s branding on its website and invoices. The initial aim is for PACT to act as a preventative measure. But once the debt becomes problematic, PACT helps stiffen a small business’s debt recovery muscle.

“There exists a no-man’s land between it being a late payment, and eventually becoming a non-payment,” said Hawthorn. “It’s crucial to act in that time. You don’t want to destroy the relationship - but you have to draw a line in the sand.”

If a creditor’s own steps at debt recovery have been frustrated, they can then upload the debt and the invoice onto the PACT database. “The system then sends three emails automatically over a period of seven days. The first would say: ‘You’ve got a debt registered and you have seven days to pay this debt. Failure to do so will incur the following repercussions.’ And then they’ll receive one after three days and one after six days,” Hawthorn explained.

The creditor decides when to enforce heavier measures. “It’s a click of one button on your customer dashboard and the debt will then be shared with all the credit reference agencies and shared on” is a fully searchable database of bad debt. The site is open for anyone to use. “Mediation will be in place as the first port of call to try to recover debt, while businesses which continue to refuse payment will be named and shamed on Defaulter.”


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04th Feb 2016 10:18

Interesting idea, but...

...the trouble with any plucky crowdsourced start-up is that can take a lot of time before it achieves critical mass.

I typed in a couple of names from companies that have recently entered administration or liquidation and got back the response, "No outstanding debts found with PACT Scheme". While a correct statement of fact, I don't think it provides much help from a debt-management point of view - it just suggests that not enough businesses have joined the scheme yet to get any meaningful results.

There's another issue to consider too, as the likes of Experian and Dun & Bradstreet would no doubt point out. They invest huge sums to keep their databases accurate so they can substantiate their credit scores and ratings - from court records, in necessary.

Non-payment is a delicate area, and sometimes angry people can go over the top. I wonder whether the preventative measures on are robust enough to protect against someone wanting to launch a malicious campaign against a business.

How willing would other AccountingWEB members be to encourage uptake of this new approach?

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By abaco
04th Feb 2016 10:26

Are You Listening Department for Business Innovation and Skills?

Good luck to Mr. Hawthorn but we have had countless promises of action from successive governments that might at least mitigate the scandal of big companies improving their cash flow at the expense of that of their smaller suppliers. It's about time this government delivered on those promises.

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By clivex
04th Feb 2016 12:34

Dangerous game perhaps?
I agree with the comments above but what if accusations are posted which are unsubstantiated or simply refer to actually disputed invoices? I can imagine certain creditors taking strong exception to this. I've written a piece on my blog

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04th Feb 2016 14:30


This is something I thought "somebody should create this" about many years ago.

Then I thought about the potential nightmare, legal and reputational, that could ensue from arguments about listings. Often there is a valid commercial (and legal) reason for late or non-payment and who is the final arbiter of the merits of such cases on a website?

Just look at the trouble Tripadvisor has with malicious and made-up "reviews".

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04th Feb 2016 14:47


Yes, because there is no way that big companies won't insert a contractual term forbidding such shaming. 


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