Last week the Greater Birmingham Chamber of Commerce commented on businesses being hard hit by late payments and they refer to statements by Barclays Bank that over 25% of UK SMEs have seen the number of late payments received increase since the cost of living has increased and this is according to new research from Barclays Bank Plc.
The new findings link late payment to SMEs and also the rise in the cost of living. Statistics from Barclays’ survey apparently show that 16% of SMEs say they are finding it more difficult to pay suppliers themselves because of the cost-of-living crisis. Obviously, late payments affect a business income which can result in cashflow instability. Small Business Commissioner Liz Barclay and Hannah Bernard the Head of Business Banking at Barclays have both commented about the negative effect on cashflow and on stopping business growth and the growth of the economy and generally the country moving forward in the right direction.
At Else Solicitors we help business clients, which includes SMEs and larger enterprises, collect cash and where money is owed and owed beyond terms it is vital that all businesses, no matter what size, recover payments on time to enable them to continue to trade. This is a fairly obvious statement but often inactivity can cause issues and the statistics provided by the Chamber of Commerce article suggest that 60% of businesses are aware they can take legal action but only 16% had done so with 26% unaware that they can make a claim for late payment interest, late payment administration charges, depending on the amount owed on the invoice, and also each invoice carries a late payment charge together with the right to recover reasonable legal costs in seeking to make a full recovery.
At Else Solicitors our objective is to make the debtor pay. This means that if you are owed money in a business to business transaction you are entitled to recover costs, interest and administration charges from the debtor and often the recovery process can be carried out at no cost to yourselves if a full recovery is made due to the benefit of relying upon the Late Payment of Commercial Debt Statutory Instrument, which gives creditors substantial rights in recovering cash and covering the cost of such activity.