In the fight against late B2B payments, the U.K. is perhaps the most vocal – both about its progress and its struggles.
Most recently, Paul Uppal, the U.K.'s former small business commissioner, raised concerns about being pushed out of the position and the government's lack of funding to combat late supplier payments.
But delayed and late invoice payments are far from an isolated problem. PYMNTS' data revealed that in the U.S., businesses are owed an estimated $3.1 trillion in accounts receivable on any given day, though how much of that is considered past-due is unclear.
This week's B2B Data Digest explores the numbers behind the global late payments fight, with new data coming in from Australia, Romania, Kenya and South Africa.
One in five invoices paid late are sent to the wrong address, according to the Australian Taxation Office (ATO). Andrew Watson, the ATO assistant commissioner in charge of small business experience, spoke to MyBusiness about the issue of invoice errors causing payment delays – the result, he said, of ongoing reliance on paper. More than 20 percent of invoices are paid late because there is incorrect information on an invoice, reports noted, while another 20 percent are late because they are sent to the wrong address entirely.
A 30-day voluntary supplier payment code is not enough for Australian businesses, according to Self-Employed Australia, an organization representing independent contractors in the nation. Executive Director Ken Phillips spoke out recently to encourage the Business Council of Australia to deploy more aggressive measures than a voluntary code to combat late payments, including a dispute service over delayed payments and independent arbitration. Phillips also warned that corporate buyers' use of reverse factoring to encourage suppliers to accept early payment discounts can be "an incredible con," as he told the Australian Financial Review.
43 percent of unpaid invoices are stuck with micro-enterprises in Romania, new research from KeysFin revealed. Recent reports explored how the burden of late payments weighs disproportionately heavy on the smallest of businesses. Small businesses and large corporates each hold about 20 percent of outstanding payments. The majority of this debt is in the form of unpaid B2B supplier invoices, the research noted, with KeysFin Managing Director Roxana Popescu highlighting the reliance of micro and small firms on trust and minimal background checks before signing deals with partners.
A £1.3 million budget is not enough for the U.K. to combat late payments, according to Paul Uppal, its former small business commissioner, in a recent report in SmallBusiness.co.uk. Uppal spoke with reporters about his grievances with the government's late payments strategy, arguing that his office's budget is insufficient "if it is going to the job" of combatting late payments.
$1.69 billion in late payments to small businesses is holding back Kenya's economic growth, according to recent reports in The Washington Post. Economists are raising concerns about a slowdown in the country’s economy, with reports pointing to growing debt and rising spending. Yet late payments have led to worker firings and hiring slowdowns in both the private and public sector, with the government's struggle to pay public sector contractors among the largest challenges in the nation's late payments fight.
$17 billion in late payments are owed to South African SMBs, new data from small business accounting firm Xero revealed. For the nation's estimated 2.5 million SMBs, that's an average of more than $6,800 in past-due invoices. Further, Xero calculated, small businesses in the country waste nearly 90 working hours a year chasing down late payments.