Late Payments Research

The Department for Business and Trade and the Office of the Small Business Commissioner have commissioned London Economics, to carry our research on the impact late payments have on small businesses.

The research’s key findings:

• Late payments are estimated to cost the UK economy almost £11 billion per year. 
• 14,000 businesses close each year because of late payments, equivalent to 38 businesses every day. 
• Over 1.5 million businesses, or 28% of businesses, are affected by late payments each year. 
• Businesses are owed an estimated £26 billion in late payments at any given time, on average £17,000 per business affected by late payment. 
• 22% of surveyed businesses said they spent staff time chasing late payments, on average 86 hours per business affected by late payment per year. This equates to 133 million hours of staff time across the economy each year. 
• 15% of surveyed businesses said they have avoided doing business with specific customers based on their payment behaviour. 

Following the publication of the research Emma Jones, Small Business Commissioner said:

“We have released research showing that business owners spend an average of 86 hours chasing debt. This is a thankless task and we want to take action on it; to reduce hours spent on non-productive ‘stuff’ and free up your time to instead spend on growth tasks. We are working to achieve this through leveraging technology that can improve payments processes and efficiency, encouraging large companies to sign up to the Fair Payment Code, and, being the Office you come to as a last resort if you need to make a complaint against a non-paying company.”