Michael Fallon, the Business and Enterprise Minister, is on record as saying that he’s going to war on the issue of late payments and, with some £37bn owed to small companies, it’s not a moment too soon.

Particularly when you realise that this equates to around £30,000 on average for every small business in the land!

And he’s putting his money where his mouth is; Fallon has gone as far as to give all FTSE 350 businesses just one month to sign up to the new rules on prompt payment of suppliers or face a “naming and shaming”.

The Prompt Payment Code is run by the Institute of Credit Management on behalf of the Department for Business, and its latest research reveals that smaller suppliers wait on average 41 days longer for payment than their contract stipulates.

The Sunday Telegraph and The Daily Telegraph have put their collective weight behind the campaign and are encouraging small businesses to speak out against the big businesses that are proving to be amongst the worst culprits. Whilst we don’t have quite the same “clout”, we’re behind Mr Fallon every step of the way but, in the meantime, we’re committed to helping those small businesses with monies outstanding to get what they’re owed.

This new stance comes as no surprise to Shire Recoveries General Manager, Rob Bates. He said “The late payment problem has been getting out of control for some time now and something needed to be done. Over the past year we have seen a major increase in the amount of late payment days, especially in the motor factor industry. We helped many motor factor businesses collect their late payments and in some cases customers were waiting nearly 80 days for payment.”

“What impact the prompt payment scheme will have remains to be seen but I feel credit management has a lot to answer for. When it comes to credit management, businesses need an affective strategy and we have become an integral part for many of our customers. Our specialist team have the experience of stopping debts from becoming toxic and collecting within the agreed payment terms”

If you’d like help or would like to know more, call Rob Bates or one of his team on 01827 300 326.