chancellor’s late payment proposals receive mixed response
March 21, 2019
The announcement that the Chancellor, Philip Hammond, has pledged to tackle the scourge of late payments in his Spring Statement has been given a cautious welcome by Eazipay Ltd, one of the country’s leading Direct Debit and automated payment processing companies.
Cambridgeshire-based, Eazipay has, for many years, been vocal in its championship of small firms as they battle to receive payment from much larger organisations and has repeatedly called for greater government intervention and support for SMEs.
“For too long, large corporates have been allowed to ride rough-shod over smaller companies by deliberately withholding payments to their suppliers and, in effect, using them as unofficial lines of credit,” says Luisa Grey, a director with Eazipay, adding:
“The chancellor’s announcement that large companies will be forced to reveal their payment practices and appoint a non-executive to oversee payments to small companies is a step in the right direction, but it is only a step.
“We have been calling for much more robust action, like fast-tracking claims for non-payment through the courts together with a policy of naming and shaming persistent late payers. We would also like to see the Small Business Commissioner given extended powers to work through claims quickly.”
Eazipay believes that late payment debts are only one of a growing number of costs facing SMEs as they lawfully pursue money that is rightfully theirs.
Figures released by Bacs Payment Schemes Limited (Bacs), for example, show that the UKs smallest businesses are facing a massive bill of some £6.7 billion just to collect money they are owed. The cost of recovering money now stands at an average of £9,000 a year.
To add insult to injury, a third of small companies are being forced to wait two months, or more, beyond their agreed payment terms before they are paid.
“While we applaud and support the chancellor in his bid to drive the scourge of late payments out of the economy, he has other weapons in his armoury and we would welcome more direct action”, concludes Luisa.
Eazipay, which currently employs 29 full and part time staff, has been at the forefront of collecting and processing automated payments like Direct Debit for over 17 years.
Through its role as a Facility Management Provider, Eazipay provides the link between businesses and their banks so that SME companies can have access to all the benefits and financial control that larger companies have by using Direct Debit as their preferred payment collection process.
In addition to its Direct Debit collection service, Eazipay also offers a range of other automated payment processing services including Faster Payments, Direct Credit transactions, SEPA Direct Debits for payment collection in Euros, and a card payment service allowing its clients to collect and process customer payments via debit and credit card.
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