Written by: Keith Tully
Published: 24th September 2015
Small and medium-sized enterprises (SMEs) in the UK are currently owed a combined total of £67 billion in relation to unpaid invoices.
That’s according to the Asset Based Finance Association (ABFA), whose research suggests that British SMEs are now typically having to wait longer for their invoices to be paid than was the case in 2009 at the height of the recession.
Non-payment of invoices is a major source of frustration among SMEs and the ABFA’s latest figures suggest that the amounts owed in these circumstances has been on the rise in recent years.
Across the country as whole, SMEs are now owed at least £67.4 billion in unpaid invoices, which represents an increase of 8 per cent on the same figure in 2014 and a jump of 36 per cent since 2011.
However, the ABFA has said that the real scale of amounts owed to SMEs in the UK is likely to be much higher than the figure of £67.4 billion because its numbers are compiled only on the basis of information on the 180,000 SMEs that submit detailed annual accounts.
According to the organisation, the average length of time that an SME has to wait for its invoices to be paid currently stands at 72 days, a figure up from 61 days in 2009.
The ABFA though is keen to convey to British SME’s that their unpaid invoices can be business assets in themselves.
“The scale of unpaid invoices to Britain’s SMEs has become enormous, but there is no reason for it to become a barrier to investment and growth,” said Jeff Longhurst, ABFA’s chief executive in a statement.
“Businesses need to recognise that their unpaid invoices are an asset. In many cases, they are the most valuable asset an SME has, and they can be the key to unlocking critical and affordable funding.”
Longhurst went on to say that invoice finance solutions are playing an increasingly important role in the management of SMEs throughout the country.
ABFA’s members include a diverse range of invoice finance companies whose services currently provide a collective total of around £9 billion in funding to British SMEs.
22nd October 2020
The UK’s live music industry is facing a crisis that could result in the loss of tens of thousands of jobs before the end of the year, it’s been claimed.Read More
21st October 2020
There are growing fears for what being entered into Tier 3 Covid restrictions might soon mean for businesses in the various regions being affected.Read More