UK businesses are paying their bills faster in 2012, according to data from Experian, although only by two thirds of a day on average
The global information services company has found that UK firms paid their bills on average 24.67 days after agreed terms, compared with 25.33 days later in Q1 2011.
It also represents an improvement of more than one full day compared to Q4 2011, when businesses paid their bills 25.97 days late on average.
Larger business made the biggest improvements. Companies with more than 501 employees are on average paying their bills two days quicker than last year.
Max Firth, UK Managing Director for Experian’s Business Information Services division, said, “Across the UK we have now seen two quarters of improving payment performance, which suggests that an increasing number of firms are creating and enforcing more robust credit management and collection policies.
“The improvement seen by the UK’s largest businesses is supported by the feedback we have had from some of our larger clients. They are keen to better understand and address the impact of their payment behaviour on smaller suppliers, and are using payment performance data to find out where they are having the greatest impact and where things can be improved.”
Regionally, payment performance improved most for firms in the West Midlands – from 26.69 days in Q1 2011 to 23.92 days Q1 2012. The North West region was the only one to see its average payment performance deteriorate - from 29.14 in Q1 2011 to 35.23 days Q1 2012.
The government has been threatening to take more action over the late payment of bills and invoices, which it says is a major block to business growth. Research last year suggests the late payment culture costs SMEs £33.6bn a year.