The UK’s late payment culture is getting worse, with the amount owed to small and medium-sized enterprises reaching record levels, a new report has revealed.
The latest research, from payment organisation Bacs, shows that late payments have now reached an all-time high of £33.6 billion.
The average amount owed to each firm is also at its highest ever level of £39,000 and firms are also having to wait longer to receive their payments.
Half of all UK SMEs are affected by the problem of late payment, and are waiting on average 28 days longer than their original payment terms to have their invoices settled.
Large companies account for nearly half of all late payments, with many blaming their internal systems for the delay.
Commenting on the research, Mike Hutchinson from Bacs said, ‘The issue of late payment is continuing to get worse for SMEs in the UK at a time when they need to be able to plan ahead for growth and ensure a strong cash flow’.
Small businesses are advised to make sure that they agree payment terms upfront, and to work to promote a culture of prompt payment throughout their business.
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