Late payments cost British businesses a staggering £20 billion a year. According to a survey of 9,000 European companies commissioned by Intrum Justitia, the credit management services group, only 53% of invoices in the UK are paid on time.
Intrum Justitia?s UK Payment Index estimates that almost half (47%) of UK invoices are overdue, on average 18 days late, and 1.9% of total revenues are never paid at all.
Not surprisingly, the main reason cited for late payment is the deliberate withholding of payment, a complaint that has come top of the list for many similar surveys. Despite 89% of respondents claiming to have experienced late payment problems, only 54% of companies interviewed had a formal credit policy in place.
Looking to
Europe the problem is worse. The EU is meant to be a growing marketplace for UK firms yet British companies can expect an even longer wait for payments from European clients in France and Germany.
According to the research the average wait for payment in the
UK is 18 days, and although there are other EU member states with much tardier records, when taken as an average, British companies are still two days slower than the overall European average.