The Irish Small and Medium Enterprises Association (ISME) have today released their Credit Watch Survey for the second quarter of 2016 which shows a small improvement in payment days to 57 days, two days better than previous quarter.
The Association warned that late payments are continuing to cause liquidity issues for some SMEs and demanded that the new administration prioritise this issue.
The main findings from 901 respondents in the final week of June are average payment period for SMEs in the first quarter of 2016 has improved by 2 days to 57. Seventeen per cent of SMEs are experiencing delays of 3 months or more, down from 24% in first quarter, 2016.
The report shows that 3% waited 120 days and over and late interest is charged by only 4% of SMEs. Dublin businesses wait longest, at 57 days, with the rest of Leinster best at 51 days.
Furthermore, 86% of SMEs favour a statutory 30 day payments regime; with no opt out.
ISME Chief Executive Mark Fielding commented, "It is essential that all businesses and in particular small business be in a position to predict their cash flow with some degree certainty. However, because of the abusive dominance of big business, cash flow across the SME sector is slow."
He added, "This market failure is allowed to happen because of the complete lack of government intervention. This situation, coupled with the lack of available and affordable credit from the bailed out banks, is slowing the recovery of many small businesses."
Source: www.businessworld.ie
