Evidence shows that the Covid-19 pandemic has exacerbated a culture of longstanding late payment problems for UK businesses.
Research by the Institute of Directors has identified that almost two in five businesses have faced an increase in late payments and overdue debts during the pandemic, with one in ten saying that late payment problems have become significantly worse.
How the government will help
The government is considering giving stronger powers to its small business commissioner, who can mediate payment disputes between companies.
A poll of 799 directors found that late payments are a perennial issue for SMEs and the pandemic certainly hasn’t helped. With so much pressure on cash flow, many companies have been left in the lurch through no fault of their own.
The government has said it would consider new powers, such as the ability to fine, saying that late payments owed to small businesses had reached £23.4 billion, which further threatens the survival of many companies during the pandemic.
In reality, there is no quick fix to solving late payments. The challenge is ingrained and will not be fixed by one specific power or another.
It is anticipated that issues are likely to increase as continued effects from the Covid-19 restrictions take their toll and emergency state support schemes begin to wind down.
How Beeston Shenton Can Help
We have a wealth of knowledge and expertise in debt recovery steps to aid your business.
We provide a considered approach to speed up debt recovery collections whilst minimising customer conflict and reducing the risk to your business.
Our service is tailored to match the individual needs of your business and pride ourselves in offering bespoke, cost-effective solutions to your debt recovery needs – from simply chasing late payers to legal proceedings including all county court and insolvency processes.
We are totally dedicated to helping our clients improve cash flow and increase the profitability of their businesses and we use the latest in Debt Recovery software enabling us to process both pre-legal and legal collections promptly and efficiently.
About the author
Iain Bould is the head of our Commercial Litigation department.
Iain has over 28 years of experience in Commercial Debt Recovery having worked in both Private Practice and Industry and brings a pragmatic and commercial approach to recovering debts. With extensive experience working across all industry sectors, Iain has particular expertise in working with Insolvency Practitioners in advising and recovering outstanding insolvent company ledgers.
If you need any advice or further information please contact Iain at iain.bould@beestonshenton.co.uk
