Posted on 7th Oct 2009 by Alan in Late payments | Comments Off
As part on the government’s push to support businesses they have amended the trade credit insurance top-up scheme – this initiative does not remove the need for businesses to control their late payment – but should increase the number of businesses that can take advantage of it.
The scheme was introduced to help those firms struggling with late payment which often led to customers defaulting on these late payment often finding it difficult to get sufficient insurance cover to safeguard themselves.
Under the scheme, which is due to run until 31 December 2009, suppliers who have seen their insurance reduced can buy six months of government-backed insurance either to restore cover to the original level or to double the amount they are able to obtain from the private sector up to a set maximum.
Research carried out by the government has suggested that businesses are adapting to reductions in their insurance by managing their credit control more actively. Late payment continues to be a major issue with UK companies. But by adopting more rigorous credit control over late payments has reduced their dependence on the scheme.
However, a number of businesses have not been eligible but they have also needed the time to adjust to reductions in their cover. Forcing their need to control late payment rather than rely on their cover.
To provide them with some extra breathing space, the government has introduced three changes to the scheme.
Where a business has seen a reduction in its credit insurance since 1 October 2008, the scheme now provides six months top-up cover at a price of 1 per cent rather than the original 2 per cent.
The old lower limit of 20,000 has been removed and the upper limit of 1 million has been increased to 2 million.
However, vigilance on late payment and effective credit control remains the watchword for businesses.
To use the scheme, businesses should contact their trade credit insurer.
Posted on 7th Oct 2009 by Alan in Late payments | Comments Off
Late payment is no myth - more and more companies are suffering the late payment syndrome.
As late payment bites the ABI figures show that trade credit insurance remains a vital lifeline to businesses that are hit by the effects of the recession.
In Quarter 1, 2009: The total number of claims was 9,213, an increase of 48% from 6,225 in Q1 2008 and the total value of claims was 316m, an increase of 166% from 119m in Q1 2008.
Late payment and poor credit control is raising concerns among credit insurers and invoice discounters.
Trade credit insurance claims are a good indicator of what is happening in the UK economy and how late payments is affecting UK businesses. Clearly, the economic situation remains very tough and highlights the need for greater vigilance with late payment and the need to ensure effective credit control.
Posted on 7th Aug 2009 by Alan in Late payments, Unpaid invoices | Comments Off
Figures published this month show a sharp rise to nearly 200,000 businesses struggling in the second quarter of this year much of it caused by the increase credit taken by late payers. Unpaid invoices continue to be of particular concern.
The increase of businesses showing signs of significant financial problems compared with last year is endemic throughout the country. Late payment and unpaid invoices are blamed by many companies with customers continuing to stretch payment.
There is a very diverse picture amongst sectors on a quarter on quarter basis:
Recruitment, engineering and manufacturing amongst others have shown substantial increases in problem companies and unpaid invoices.
Construction and professional services have in contrast shown reductions in problem customers quarter on quarter but unpaid invoices are of continuing concern. Read the rest of this entry »
Posted on 7th Aug 2009 by Alan in Late payments | Comments Off
“Battle-damaged by a year of recession and plagued by poor liquidity, the UK’s largest firms will be unable to respond to the economic upturn when it emerges”, new research by Roland Berger Strategy Consultants reveals today.
“Companies do not anticipate recovery until next year, but hit by poor turnover, an ongoing credit shortage, late-paying customers and pressure on interest cover, they will be unable to respond to the upturn for a further 6½ months after it commences.”
Yet again we see late payments as the cause of so many companies’ ills.
Roland Bergers Restructuring Survey 2009 also reveals that “firms are failing to control costs effectively in the face of these financial woes, and are dragging their feet over urgently needed restructuring.” Read the rest of this entry »
Posted on 15th May 2009 by Cashflow Protector in Late payments | Comments Off
Thousands of small business jobs are being put at risk because councils are failing to pay invoices within the Government imposed 10-day target.
Despite orders from the Business Secretary, Lord Mandelson, four out of five local authorities are ignoring pleas to help firms by speeding up invoice payments and continuing to make late payment.
Small business leaders warn that thousands of jobs are being put in danger, as late payment stretch credit supplies of companies already struggling with the recession.
Critics said it provided “yet more evidence that the Government’s policies aren’t working”.
Read the rest of this entry »
