Businesses throughout the UK and Europe have written off £245bn over the last year because of late payments, new research has revealed.
The Swedish based debt buyer Intrum Justitia surveyed 6,000 European companies including some from Britain, It found that the amount of debt that had been written off rose by £24bn to £245bn over the last 12 months.
It meant that 2.6% of transactions were written off compared with 2.4% the year before. The research also suggested that the situation is unlikely to improve in the near future. Only 10% of businesses were optimistic that conditions would get better over the next 12 months.
Looking specifically at the UK, the survey revealed that the percentage of debt written off remained at 2.4%. However, the number of invoices being paid within 30 days declined by 5%.
A total of 54% of businesses reported reduced liquidity because of late payments and 41% were pessimistic about their chances of getting support from their banks.
The research highlights yet again the need for businesses to protect themselves by taking early action as soon as problems with late payments begin to arise. A solicitor's letter is often enough to secure payment as the debtor knows right at the outset that you are taking the matter seriously and are prepared to take legal action.
For those who still don't pay there are several more legal measures available to secure prompt settlement. Please contact us if you would like more information.
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