Business payment performance trends look to be heading in the right direction at last, according to the number-crunchers at credit and information services specialist Experian.
Analysts found that the average UK business was paying its bills2.06 days earlier during September compared to August, and 1.28 days earlier than this time last year, at 21.54 days beyond terms.
The figures may be improving, but overall businesses are still a long way off the September 2008 average of 15.44 days. Experian said the fall was the largest seen since December 2007, back in the early days of the credit crunch.
The largest gains were seen in the Greater London area, with Yorkshire seeing the least improvement. The IT sector saw the biggest improvement both year-on-year and month-on-month, down43.7% and 25.2% respectively.
Experian’s Business Information unit commercial credit head,Joe Myers, said the improving trend provided early evidence that the Prompt Payer Register – a service set up to encourage ethical business practices – was having some effect.
“Payment within agreed terms is favourable and this information is used to support credit scores and limits. Businesses need to be aware that a history of slow payment will have a detrimental effect on their credit score,” Myers pointed out.