Platform partnership leads to prompt payment

Small businesses will know that to get paid with larger clients, there is often a requirement to first onboard to a supplier platform. As we ready for new payment laws coming into effect, large businesses tell us they are turning to such supplier platforms to ensure compliance. For these reasons, we knew it was important to engage and partner with the platforms to ensure smooth transition when the UK introduces maximum 60-day payment terms and mandatory interest.

This week we were delighted to welcome a delegation of platforms to Old Admiralty Building for discussion on a) bringing platforms up to date on payment policy and Bill progress b) ensuring platform features are ready for the new laws and c) promotion to platform users of the changes.

With thanks to all who attended – you can see the attendee list below.

Key points from the meet:

• There is a close correlation between prompt payment and the government’s e-invoicing mandate that comes into effect in 2029. Participants encouraged us to ensure close work between our Office and HMRC in readying UK businesses for positive change.
• The new 60-day payment terms will apply to new contracts from the point of the law being introduced. There was discussion on how this impacts contracts with more than 60-day payment terms that auto-renew ie would small firms flag to larger clients that these should be updated to reflect new laws. On this, the law will state that activity after the law comes into place can be considered poor payment practice even if the original contract was signed before the Bill. Therefore a renewal point would be seen as the time in which terms would need to change to 60 days, otherwise the paying business would be deemed to be trying to circumvent the legislation.
• My Office may be called Office of the Small Business Commissioner but new laws will apply to businesses of all sizes. Participants encouraged us to stress this in marketing and comms ie whether small or large, businesses will have to pay each other within 60 days, with the remit of the Office remaining focused on supporting small firms (with less than 50 employees) when it comes to adjudication and casework to get owed monies recovered.
• We were encouraged to take learnings from the construction sector which was historically renowned for poor payment practices yet has improved over time, with the construction sector now accounting for the largest number of businesses on the Fair Payment Code. In construction there is growing acceptance that paying suppliers on time is the right way to do business – and it’s good for business – as if you don’t pay prompt, you lose valued suppliers and employees.

It was a positive meeting and I’m delighted discussion has begun with these platforms that play such a critical role in rapid onboarding and payment of suppliers.

Emma

Attendees

• Thomson Reuters
• Tungsten
• Ivalua
• Causeway
• SAP Taulia
• Open ECX
• Purchase2Pay Network
• Basware
• Cimple

Invited but did not attend

• Coupa
• Oracle