Toothless tiger takes a bite
~ PPC issues suspensions to more than 20 businesses ~
November 11, 2019
On more than one occasion the Prompt Payment Code has been publicly criticised for being far too slow to react when large corporate members have been accused of mistreating smaller suppliers.
Often referred to as a toothless tiger, the Prompt Payment Code was set up with no meaningful sanctions to act as a deterrent to paying SME suppliers late. One of its main downfalls is that you can still pay suppliers late and still be a member!
Well, our toothless tiger is now staring to bite.
The Chartered Institute of Credit Management (CICM), which now administers the Code on behalf of the Department for Business, Energy and Industrial Strategy (BEIS), announced on Tuesday that a total of 20 companies – including AstraZeneca, IBM and Unilever – have been suspended from the Prompt Payment Code for failing to pay suppliers on time.
Diageo, GlaxoSmithKline and Kier businesses are also among those that have failed to honour their Code commitment to pay 95 percent of all supplier invoices within 60 days.
It’s a good start but we still feel this is too long for small companies to wait for money they are owed - 30 days is long enough.
In the CICM’s announcement, Small Business Minister, Kelly Tolhurst, was quoted as saying: “We want to make sure that the UK is the best place in the world to work and start a business. Tackling late payments will ensure we level the playing field for small businesses so they can grow and thrive.”
We completely agree with all of that; its what Eazipay has been striving for for years. However, the 60 day payment term is still too long for the vast majority of small business and it needs to changed. Let’s hope it will be.
One final thought, if you’re an SME and your being forced to wait 60 days by a large company, then insist that you can set up and be paid by Direct Debit. It’ll ensure that you are not kept waiting one day longer than is absolutely necessary.
For further press information, please contact:
Damion Clark at Real PR (Consultants) LLP. Tel: 01353 667934 or 07789 911314 Email: email@example.com