Late payments are huge problem, but it doesn’t have to be that way

Bacs issued a press release today entitled ‘British businesses bear late payment burden of £30 billion.’  Late payment has always been a major problem, not just for corporates in the UK, but for businesses everywhere.  Bacs claims that this late payment problem is getting worse in the UK, and that SME’s are collectively owed a staggering £30.4 billion – a rise of £11 billion rise over the last two years. Usual excuses for late payments include cashflow problems, simply forgetting (!) and the usual ‘the cheques in the post’ excuse.

Yet there is a way out.  Electronic Invoicing Presentment and Payment (EIPP) systems can so easily eradicate many of these problems, and here are just a couple reasons why;

• Electronic invoice delivery ensures that the invoice is delivered to the correct person quickly and is available online 24/7.  An e-archive ensures that it will never get lost.
• The sender also knows when an invoice has been viewed and approved.  The online approval process is much quicker than more traditional methods and this visibility can help suppliers to forecast cashflow.
• Automatic email prompts ensure that the recipient doesn’t forget that an invoice needs their attention.
• Offering early payment terms for e-invoice recipients can benefit both suppliers and customers.  Suppliers get their money quicker and customers enjoy a discount.
• Incorporating electronic payment methods into the online invoicing process will help too. Giving customers the option to view and pay and invoice online will ensure that you get paid quickly and directly into in your bank account – no more ‘the cheques in the post’ excuses. Similarly, offering an Direct Debit option can guarantee steady income for suppliers and also spread the cost of payment for customers and help alleviate cashflow problems.

Click here to read the full press release