Fed up with the issue of late payments, Direct Debit processing
firm Eazipay has launched an e-petition calling on the government
to take much firmer action to help small businesses get paid on
time. According to business research by Bacs, small to midsized
companies (SMEs) are currently owed more than £36 billion in
late payments and Eazipay believes that the government is doing
next to nothing to protect SMEs from this “catastrophic
debt burden”.
Eazipay has also slammed the government-backed Prompt Payment
Code as being nothing more than “window dressing which
allows big companies to look as if they care about paying on time
while enforcing payment terms on their suppliers of up to sixty
days”.
Indeed, it recently emerged that apparel retailer Monsoon
Accessorize had extended payment times from 60 to 90 days with
suppliers subject to a mandatory 4 percent “invoice
discount”, notes the Forum of Private Business.
The Forum has also criticised Debenhams, one of the UK’s largest
department stores, after it learned suppliers were being
instructed to make discounts of at least 2 percent on invoices.
The ethics of which, it said, “really should raise
eyebrows”. Further, the Forum highlights Debenhams’ track
record, with standard payment times of 120 days. “This kind
of behaviour is making it all the more crucial for small firms to
have strong credit control procedures in place. Ensuring your
business is paid promptly and in full is essential for
maintaining a healthy cash flow,” said Forum spokesman
Robert Downes.
To tackle what it calls “the scourge of late payment”
Eazipay’s e-petition urges the government to do much more to
address the issue of late payments. The petition is available to view online here.
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