Late payments threaten SMEs

Overdue payments are having a significant impact on Irish businesses cash flow with small to medium-sized enterprises particularly vulnerable to late payments.

On average, Irish people pay their accounts 15.7 days beyond the due date, according to the European Payment Index.

Almost half of Irish businesses stated that cash flow was affected with one in five saying this represents a significant threat to survival.

Companies surveyed cited payment uncertainty as the most significant obstacle to growth in international trade.

Long payment delays - or no payment at all - are making companies think twice before doing business in another country, thereby hampering the single market and harming European competitiveness.

Commenting on the results, Managing Director of Intrum Ireland Nick Biggam said: "On the positive side, Irish companies are looking ahead with a degree of confidence. Some 35% of businesses surveyed anticipate general economic conditions will have a positive effect on their own business this year.

"Companies, to some extent, can help themselves by improving their credit management procedures. A healthy credit management system and correct payment behaviour is essential for the survival and growth of business in Ireland and across the single market," Biggam added.

The European Payment Index is based on a survey of over 9,000 companies and compares payment habits in 22 European countries.