The trend of late payments plaguing the U.K. continues, and there’s now some geographic illumination on just where the late payers are located.
To that end, there is new data from invoicing platform Solna, showing that — as measured across 3 million small businesses (SMBs) based in the U.K. — a number of areas stand out for late payments, spanning West Central London, Bolton and East Central London. Lower risk areas include rural regions, the study found, and remote Scottish islands are home to some of the most reliable payers, measured by the length of time it takes to get suppliers paid.
As noted by Bytestart, the more densely populated locations have more SMBs in place — which means that, against a competitive landscape, they are more likely to hang on to (aka delay) cash payouts to their suppliers.
However, in a statement on the results, Solna CEO Inna Kaushan stated that “the reasons why people in more rural areas have better scores than businesses based in London and other urban areas [are] a combination of cultural, geographical and economic factors. Businesses in a smaller community are more likely to pay their suppliers on time because it is often the case that they know them. In a smaller community, getting a reputation for being unreliable could be really damaging to their business.”
As has been reported, and estimated by the Federation of Small Businesses (FSB), 58 percent of FSB members are owed as much as £10,000 ($13,239.24 USD) in late payments from their clients, and as much as 27 percent are owed more than £20,000 from their late-paying clients.
Separately, in the U.S., the New York Post reported that Councilman Justin Brannan, chairman of the Committee on Contracts, is debuting three bills in New York that will curb late payments to nonprofits, with the creation of a new division to speed payments. City agencies would also have to pay interest on those payments as well, said the Post.
“There are some groups that we spoke with that are still waiting to get paid millions of dollars for services they performed years ago, which is just outrageous,” Brannan said in an interview with the paper. “These bills … will help ensure timely payments to contractors, penalize city agencies [that] take too long to make payments and provide much more clarity for our city’s human services providers, who do life-saving work for New Yorkers.”
The Post reported that the Department of Homeless Services was late in getting contracts paid by as much as 80 percent of the time. A number of other agencies, the paper reported, were late 59 percent of the time.
In terms of individual company news, Reuters reported that S&P Global Ratings has kept Qinghai Provincial Investment Group (QPIG), based in northwestern China, on a “negative” watch. The company missed an interest payment due in late February on a $300 million offshore note.
The news has led S&P to lower its rating to CCC-plus from B-plus. The state-owned aluminum producer said the delayed payment was due to “technical reasons,” but that the payment would be made in full.
The newswire noted that other firms have missed payments on offshore bonds as well, amid a slowing Chinese economy. As reported in 2018, 46 bond issuers missed payments on 120 bonds outstanding, worth more than ¥111.2 billion (nearly $994 million USD), as calculated by the China Central Depository and Clearing Company.