B2B Payments

Legislators Introduce Bill For Faster Payments To Small Businesses

Legislative efforts to combat late supplier payments have emerged in Europe, the U.K. and Australia. Now, similar initiatives have begun in the U.S.

Reports in SCVNews on Wednesday (March 21) said Rep. Steve Knight (R-CA) and Rep. Adriano Espaillat (D-NY) introduced the Accelerated Payments for Small Businesses Act of 2018. The legislation would require government entities to pay their small business contractors within 15 days of receiving an invoice, reports explained, and would introduce similar goal for  government contractors working with their own small business subcontractors.

The legislation would make law a previous policy put forth by the Office of Management and Budget. The bill is co-sponsored by House Small Business Committee Chairman Steve Chabot (R-OH) and Ranking Member Nydia Velázquez (D-NY).

“Small business contractors rely on a consistent and reliable flow of income in order to keep their operations running smoothly,” Knight said in a statement. “The Accelerated Payments for Small Businesses Act will help ensure these businesses receive their payments in a timely and accountable manner. This consistency will enable businesses to focus on improving their services and expanding production.”

“Delays in payments to federal contracts are often untenable for small business contractors and their employers,” added Espaillat. “I am proud to co-sponsor the Accelerated Payments for Small Businesses Act to ensure that all transactions among small business contractors are treated with the respect and equity they deserve. Making this commitment will yield a tremendous return, further incorporating small businesses — including those that are women-owned, minority-owned, veteran-owned and HUBZone contractors.”

“Time and time again, we’ve heard from entrepreneurs that needlessly suffer delays when trying to receive payment or federal contracts,” added Velázquez. “For small companies, payment delays can mean cash flow problems, constraining their expansion and slowing job growth. By accelerating payments to small companies, this legislation will help small contractors meet payroll, reinvest in their operations and create good paying jobs along the way.”

Australia recently introduced similar rules last year that require government entities to pay suppliers within 20 days of receiving an invoice.

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