Almost a quarter (23 per cent) of small business owners say they don’t normally have their invoices settled on time, according to a new study looking into late payment culture.
The research, published by Crossflow Payments and YouGov, further revealed that 15 per cent of all small business turnover was subject to late payment in 2016.
Of those who have experienced late payment, 55 per cent said delays usually stretch to ten days or more beyond their contract terms.
To add fuel to the fire, Tony Duggan, CEO of Crossflow Payments, suggests that businesses are now experiencing a “Brexit payment crunch”.
That’s because 10 per cent of those surveyed say they’ve witnessed worsened payment terms since last June’s referendum.
“Brexit is increasing the issue of late payments and reducing investment by small businesses at a time when the UK faces economic uncertainty,” said Mr Duggan.
“Delays in receiving payment promptly from customers is acting as a handbrake on businesses, preventing them from making key investment decisions for the future, and ultimately stunting growth. In 2017, it should no longer be the case that businesses face such hurdles.”
The research estimates that the total sum of all late payments equates to £266 billion. It says if businesses could access this capital, they would be able to create up to 3.4 million additional jobs in the UK.
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