# Late payments not just a smaller business issue Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2017-08-08 Category: BUSINESS Category URL: https://financedigest.com/category/business Meta Title: How UK businesses can tackle late payment challenges Meta Description: Discover how the business community, not government, is being urged to find a solution to late payments affecting SMEs in the UK. Learn more here. URL: https://financedigest.com/late-payments-not-just-a-smaller-business-issuehtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/graphicstock-man-using-mobi-1736843612235-compressed.jpg) **_Solution must come from business community, not government_** Late payments are an even bigger challenge for those medium-sized companies,with 94% of businesses employing over 50 people reporting that the issue is causing cashflow problems for them. This is according to new figures from Ultimate Finance, a leading UK funding partner to the SME market. In partnership with BDRC Continental, Ultimate Finance conducted research into the impact of [late payments](https://www.financedigest.com/the-late-payments-toolkit-how-to-keep-the-cash-flow-strong.html "THE LATE PAYMENTS TOOLKIT – HOW TO KEEP THE CASH-FLOW STRONG") on the SME sector. Other stats to be [revealed by the research](https://www.financedigest.com/the-pandemics-impact-on-working-mothers-new-research-reveals-that-two-thirds-have-stopped-working-or-now-work-less.html "The Pandemic’s Impact on Working Mothers: New Research Reveals That Two-Thirds Have Stopped Working or Now Work Less") include: - Overall, 81% of SMEs state late payments are an issue for them - 51% of SMEs believe their [business would run smoother if they had fewer late payments](https://www.financedigest.com/technology-is-a-tonic-for-late-business-payments.html "TECHNOLOGY IS A TONIC FOR LATE BUSINESS PAYMENTS") - 82% of SMEs have up to £25k in late payments - This rises for medium-sized [companies which have an average of over £30k in late payments](https://www.financedigest.com/papaya-global-makes-historical-impact-first-payroll-payments-company-included-in-time100s-2023-most-influential-companies-list.html "Papaya Global Makes Historical Impact – First Payroll & Payments Company Included in TIME100’s 2023 Most Influential Companies List") Late payments within the sector are an increasingly public issue, with the main political parties vowing to stamp out the problem with legislation such as late payment reporting. Ultimate Finance however, say that this sort of legislation can be incredibly divisive, and recognise thatbusinesses of all sizes have their own cashflow issues. The company is now [calling for the business](https://www.financedigest.com/how-can-call-tracking-improve-your-business.html "How can call tracking improve your business?") community to come together and find its own solution. Anthony Persse, Director of Strategy at Ultimate Finance commented: “We know that late payments can have a huge impact on [small businesses](https://www.financedigest.com/reasons-to-obtain-iso-9001-certification-for-small-businesses-in-australia.html "Reasons To Obtain ISO 9001 Certification For Small Businesses In Australia"). It is without a doubt, one of the biggest [challenges faced](https://www.financedigest.com/overcoming-challenges-faced-in-business-from-one-woman-to-another.html "Overcoming challenges faced in business: from one woman to another") by UK companies. However, there is a deep misconception that it is an exclusively [small business](https://www.financedigest.com/how-to-start-a-small-business-at-home.html "How to start a small business at home") issue which is simply untrue. “This is [leading to rules such as late payment reporting](https://www.financedigest.com/asia-pacific-region-to-lead-the-global-static-shielding-bags-market-fact-mr-report.html "Asia Pacific Region to Lead the Global Static Shielding Bags Market: Fact.MR Report"), which is creating an ‘us and them’ situation, when we should be seeking a workable long term solution. This is not just a case of the bigger boys picking on the smaller guys; cashflow and [supply chain management](https://www.financedigest.com/supply-chain-management-bpo-market-is-thriving-with-rising-latest-trends-2014-2020.html "Supply Chain Management BPO Market Is Thriving With Rising Latest Trends 2014 – 2020") affects every organisation, and should be tackled by the community coming together to support one another.” The [impact of government](https://www.financedigest.com/the-impact-of-environmental-social-and-governance-esg-investing.html "The Impact of Environmental, Social, and Governance (ESG) Investing") intervention has also been questioned by SMEs themselves. In research by BACS [\[i\]](#_edn1), 38% of small business owners questioned were unconvinced legislation would be helpful. Ultimate Finance, which works with thousands of SMEs across the UK, believes that the business community [needs to look at the way cashflow challenges affect companies of every](https://www.financedigest.com/insurance-that-every-individual-needs.html "Insurance that every individual needs…") size, and create an initiative or code of conduct that supports businesses holistically. “We have taken a look at the numbers,” Persse says. “Many SMEs have significant late payment debt and it’s clear that something must be done. “But current methods to help aren’t doing the job; just look at the [bank referral scheme which is being evaluated for effectiveness](https://www.financedigest.com/mind-the-education-gap-banks-are-failing-to-effectively-explain-and-communicate-financial-terms.html "Mind the education gap – banks are failing to effectively explain and communicate financial terms"). “The issue is that politicians keep coming up with one-size fits all ideas and trying to dictate to businesses. Both SMEs and [corporates are full of intelligent people who understand](https://www.financedigest.com/corporate-leadership-understanding-your-own-bias.html "Corporate Leadership: Understanding Your Own Bias") the challenges better than anyone. They should be the ones to create the solution, with [support from government and the wider industry](https://www.financedigest.com/uk-consumer-industries-warn-curbing-energy-support-will-hit-demand.html "UK consumer industries warn curbing energy support will hit demand") – not the other way around.” For further information go to www.ultimatefinance.com [\[i\]](#_ednref1) BACS, late payment research, December 2016 --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---