A new survey from the Irish Small and Medium Enterprises Association reveals that average payment periods for SMEs is the longest on record at 69 days.
It also shows that only one in five (20%) companies are being paid within 30 days, while 10% are waiting over 100 days.
ISME says that small and medium sized businesses are on average owed twice as much trade credit as they themselves owe to larger businesses.
The association warns of the consequences for SMEs of late payments and say that the very survival of many small businesses is threatened by late payment while many face bankruptcy because of the changed bank lending policies. It also accuses the Government of sitting 'idly by', refusing to accept the new realities.
ISME's CEO Mark Fielding says the biggest culprits of late payment are the accountancy-led big businesses and state organisations that 'treat small enterprise debt with disdain but demand payment themselves on the button'.
Mr Fielding calls on the Government to introduce a mandatory payment period, whereby all companies regardless of size, would be guaranteed payment within 30 days. He says this could be introduced over a three year period.
He also wants a mechanism along the lines of the existing small claims court structure to settle business to business rows as they arise and to prevent further abuse of the small business sector.
