Are you prepared for a surge in late payments?

James Salmon, Operations Director.

23rd June 2022

As inflation rises and interest rates creep up, late payments are expected to grow significantly!

UK businesses are especially going to feel the pressure, with no protection from rising energy costs, supply chain disruption exacerbated by Brexit and the danger the economy could fall into stagflation!

About six in 10 companies say they are worried that the risk of late payments will grow this year, according to Intrum’s annual European Payment Report 2022, which surveyed 11,000 companies across 29 European countries.

A third of respondents say that late payments are prohibiting growth of the company, hampering the economic and social development of the economy.

Eddie Nott, MD for Intrum UK, says that more than half of businesses expect late payments to jump this year, but “a similar proportion say they do not have the in-house expertise needed to successfully manage the impact of inflation on their business”.

Meanwhile, respondents admit they are struggling to manage the impact of inflation on their businesses, with more than half of UK businesses saying it is inhibiting growth (51%), stopping them from meeting wage demands (57%), and preventing them from paying suppliers on time (60%).

Eddie Nott added “UK businesses are battening down the hatches and are less likely to prioritise growth than their European peers,”.

Also, almost six in 10 businesses say they are more cautious with their borrowing and spending plans, as they expect interest rates to rise more than once during the next 12 months.