An expert in debt recovery has revealed the top excuses for late payment, as research shows the issue is costing businesses in the UK billions each year.
Recent figures from Bacs Payment Schemes Ltd, the company behind Direct Debit, showed that small to medium enterprises (SMEs) are owed a total of £14.2billion.
Sharon Walker, Debt Recovery manager at regional law firm Napthens, reveals that clients faced with the issue often report similar reasons for facing late payments.
Sharon has now revealed the top five excuses for late payments reported by Lancashire and Cumbria businesses:
- “I’ve not had the invoice.”
- “There’s a dispute with the invoice.”
- “There’s not a payment run until next month.”
- “There’s nobody to sign a cheque.”
- “I can’t afford to pay you until we get paid ourselves.”
Sharon explained: “This is an astonishing figure, and even though it’s down on previous years, still represents a huge shortfall for businesses which often cannot afford this kind of debt hanging over them.
“The statistics from Bacs show that of the 1.7million SMEs in the UK, around a third wait longer than agreed terms of payment.
“Companies must then spend time chasing these payments, which have staffing and financial implications, and may even result in bankruptcy in extreme cases.
“Businesses facing these kinds of pressures should consult their advisers as soon as they can to prevent the issue getting out of hand.”