Perfectly worthwhile and effective companies are starting to be pushed in the direction of business bankruptcy due to overdue payments said Luisa Grey, a director with direct debit processing business, Eazipay Ltd.
“Many smaller businesses are currently being kept waiting for much longer than their stipulated trading terms and conditions prior to their invoices are paid. In some instances the delay in receiving payment could be as numerous as 41 days longer than their regular payment terms.
“In the present economic climate, maintaining control over cash flow is important to a companies survival and when businesses are starved of money, regardless of how effective they’re, disaster looms.”
Delayed payments extremely rapidly produce a vicious circle said Luisa: “If 1 business doesn’t pay an additional on time, then a non-payment domino effect is developed where company following company is caught in a cash flow trap.
“Cashflow issues are frequently cited by businesses as the primary reason why they delay paying their suppliers, but those issues could be eased if the non-payment cycle had been to be broken by businesses paying every other on time.”
Outsource your cash flow problem use Invoice Factoring and get paid day 1 on your Invoices raised.
Based on business figures nearly a million little to medium size companies have been impacted by late payments having a staggering £24bn becoming owed in late payments at any 1 time.
“The issue isn’t confined to little businesses not paying other little businesses, big businesses and even government departments are equally guilty of sitting on their money instead of paying bills on time,” said Luisa.
With cheques because of be phased out in 2018, businesses ought to be actively looking for option payment techniques. Generating payment via the established Bacs program would break the late payments cycle at a stroke, believed Luisa.
“It is really an extremely easy procedure to have cash that you’re owed paid directly into your company bank account via the direct debit program,” said Luisa: “Running a company is tough sufficient with out the extra risks that late payments produce.”