Late payments put a quarter of SMEs at risk of financial crisis

By Gillian Crotty

Just under a quarter (23 per cent) of SMEs say late invoice payments have put them at risk of going out of business, according to a new survey by Tungsten.

The 1,000 SMEs who responded to the survey said that half of their invoices were not paid on time, and the average total debt owed to SMEs in unpaid invoices is £40,857. Large businesses are the worst when it comes to making payments on time, according to 22 per cent of those surveyed, while 8 per cent said they experienced more problems with payments from the public sector. Richard Hurwitz, chief executive at Tungsten, said:

“An unpaid invoice can mean the difference between a successful month of trading and a dangerous financial shortfall. In the worst case it could lead to insolvency.”

Business owners are advised to carry out credit checks on new clients, implement an internal debt chasing procedure, and to consider using an external debt recovery service for historic debts were they have chased payment unsuccessfully.

If you own or run a business in Northern Ireland, and require information about a solicitor debt recovery service, contact Wilson Nesbitt in Belfast by calling 0800 840 9291.