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The latest Late Payment Index from Experian, the global information services company, shows that UK businesses are paying their bills significantly faster than they did this time last year.
Experian's analysis shows that during January to March this year, businesses paid their bills an average of 20.93 days late compared to 23.61 days late in Q1 2009.
Joe Myers, Head of Commercial Credit at Experian, said "this is a positive step for businesses, mirrored by a stabilisation in business insolvencies over the last year. Businesses of all sizes know the impact a late payment can have on their cash flow and also just how important it is to regularly monitor a customerâ€™s ability to pay on time."
Compared to October to December 2009 (20.82 days), payment performance in the first quarter of 2010 was fractionally slower. According to Experian's experts, the slight lag is most likely to be due to the 'Big Freeze' in January that saw travel and postal services disrupted across most of the UK.
- Of the five regions that saw an improvement from Q4 2009, the biggest came from the South West. It also continues to be the region where businesses pay their late bills the fastest, 16.07 days late.
- The biggest increase in late payment came from Scottish businesses, but this was still only a minor increase, from 22.09 in Q4 2009 to 22.67 in Q1 2010.
- Greater London saw the greatest Q1 2009 to Q1 2010 improvement, from 28.73 days to 23.89 days.
- In terms of size of business, only the smallest businesses saw improvements from Q4 2009 to Q1 2010, those falling into the 1 to 2, 3 to 5 and 6 to 10 employees categories.
- The biggest increase from Q4 2009 in overdue days came from businesses with 26 to 50 employees - from 18.96 days to 19.36 days.
- Micro businesses (1 to 2 employees) led the improvements from Q1 2009 to Q1 2010, from 20.76 days to 17.90 days.
- For the first time, property businesses overtook postal/telecommunications businesses as the sector with the worst payment performance, paying their bills 33.60 days after agreed terms.
- The biggest improvement from Q4 2009 came from the utilities sector (from 29.12 days) followed by the breweries (from 18.59 days) and IT (from 16.13 days).
- Spirits/wine/tobacco businesses saw the worst deterioration from Q4 2009 (from 18.63 days) followed by food retailing (from 25.84 days) and banking/financial services (from 24.87 days).
- Food retailing was also the sector to see the biggest increase in overdue days from Q1 2009, from 24.29 days to 26.76 days.
To read categorised tables in detail please click here