Having accurate and reliable customer financial information reduces bad debt and the time you spend dealing with it. It also gives you the detail and time to better engage with new customers. In turn, this allows you to stabilise your cash flow, protect your balance sheet against bad debts, expand sales, boost your borrowing power and confidently develop new markets. Credit insurance is one of the few insurances that works not just for tomorrow; it helps you to grow and protect your business today.

SME late payments

The total sums owed to Britain’s small and medium-sized enterprises have reached a record high of 35.3 billion, according to research to be published. Bacs payment schemes, the organisation that runs the clearing and settlement of automated payments including direct debits, said that the total outstanding to SMEs had risen by 2 billion during the past six months.

Company insolvencies

Insolvency rates in Q1 2018 have risen dramatically compared to Q4 2017 according to the latest Government statistics. These figures correspond with the current research from the Office for National Statistics (ONS) which indicate the UK market is undergoing the slowest period of GDP growth in the last five years. The total number of new company insolvencies during Q1 2018 was 4462.

Consequences

The consequences of late payment are well documented, with the annual survey additionally finding that businesses had to wait an average of 17 days beyond their agreed credit terms to be paid in that period. A result of this is that 32% of businesses now classify more than 10% of their debtor book as bad debt. Unfortunately, late payment has also had a knock on effect down the supply chain which only exacerbates this problem further. Well over half of businesses admitted to paying their suppliers later (59%) as a result of their customer paying an invoice late.