Improvements in late payments in third quarter - ISME surveyMonday 07 October 2013 09.27
ISME, the small and medium enterprises association, has said that the average waiting times for businesses to get paid is improving.
According to its latest Credit Watch Survey, it said that businesses are waiting for an average of 63 days in the third quarter. This compares to 66 days in the April to June quarter.
The association noted that the 63 day period is the shortest waiting period since the spring of 2008.
The survey shows that 30% of small firms are seeing delays of three months or more, down from 36% in the second quarter of the year. 4% are also waiting over 120 days, down from 10% in the previous quarter.
It also reveals that Ulster and Munster firms wait the longest time for payments, while companies in Connacht are paid the fastest.
ISME said that four fifths of SMEs do not charge interest on late payments as they are afraid that larger businesses will stop dealing with them.
While the overall credit levels have improved, ISME has called again for a strict statutory 30 day payment regime for all businesses in Ireland to be phased in over three years.
''It is now time to listen to the four in five SMEs who favour a mandatory 30 day payment regime, with no exceptions, which could be introduced over three years,'' commented ISME chief executive Mark Fielding.
It also demanded that state agencies - especially the HSE - adhere to a 15 day rule on payments, while it called on Government to "name and shame" companies who pay SME businesses late.
"The ISME recommendations would allow all businesses to predict their cash flow, introduce a level playing field for all credit transactions, reduce reliance on bank finance and bring down the cost of doing business. This initiative would stop the abuse of dominance by large business and state agencies and allow indigenous small enterprises to survive and maintain jobs," Mr Fielding stated.