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Late payment remains ‘a significant concern’ for SMEs

The Forum of Private Business (FPB) has warned that late payment remains a significant issue for many of the UK’s SMEs, with more than a million firms experiencing problems.

The business group is urging MPs to introduce measures to tackle the issue of late and slow payment, with its own suggestions including:

all prime contractors bidding on Government contracts, and public organisations dispensing cash to small businesses, should sign the Prompt Payment Code
e-invoicing should be more widely adopted within the public sector
the provision of legal clarity on the FPB’s new power to represent members on the issue
Alexander Jackman, FPB Head of Policy, said, ‘Research has suggested 35% of small businesses have seen a reduction in profit and 16% have seen a noticeable reduction in turnover as a response to late payment or bad debts’.

‘Late payments are also having a knock-on effect, leaving many SMEs in a vicious circle of in turn paying their suppliers late. It starts at the top and tends to wash down the entire supply chain.’