The pandemic has motivated the UK’s businesses to crack down on late payment, according to the latest European Payment Report from Intrum.
More than 11,000 firms across 29 European countries participated in the research.
Tomorrow (Thursday 17th June), Intrum’s UK client and sales director Ian Davies will take part in a panel discussion on the credit management options open to businesses in today’s environment as part of Credit Connect’s Commercial Credit & Collections Conference. He will share some of the UK-specific findings of the report and invite attending businesses to benchmark themselves against the report’s findings.
More than half of UK firms (55 per cent) say the pandemic has motivated them to get better at managing the risk of late payments in their business. While 50 per cent said they had accepted longer payment terms than they are comfortable with in order to protect the customer relationship, this is down from 80 per cent in 2020.
The payment gap (the gap between agreed terms and the actual time taken to pay) has also narrowed across all customers types, falling from ten days to eight for consumers, 19-12 days for B2B customers and 23-11 days for the public sector. The pandemic has clearly focused minds on late payment – 56 per cent said it has increased their awareness of the impact this has on small businesses.
However, it is not clear that his will create lasting change, and almost two-thirds (62 per cent) are more concerned than ever before about their customers’ ability to pay, predicting that the risk of late payments will increase over the next 12 months.