As Jonathan Andrew, CEO of Bibby Financial Services, noted, 'This is a supply chain disaster waiting to happen for SMEs, as well as a huge economic leakage. While late payment is a known challenge, bad debt, where unpaid invoices are written-off entirely, is a hidden assassin that can wreak havoc through SME supply chains.'
According to the report, 'Late payment leads to 50,000 business closures a year. Despite a 9 percent drop between July and August 2024, corporate insolvencies remain higher than pre-pandemic levels.'
Andrew emphasizes, 'Measures announced by the Government such as the Fair Payment Code are welcome, but the reality is that it's not only larger businesses that pay late. Many small businesses do so through necessity or to preserve cashflow to make critical payments.'
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