A leading credit control expert has backed plans from the Federation of Small Businesses to dish out ‘ASBOs’ to chronic late payers.
After lobbying for stronger late payment legislation in the Chancellor’s Budget in April, the business group is resorting to a form of anti-social behaviour order (ASBO) in a bid to shame people into settling their bills.
However, Jenny Esau, managing director of Wirral based company, Credit Management Group UK (CMGUK) said despite the public naming and shaming, small businesses still need much more support after figures revealed small firms are owed a mammoth £25.9 billion in outstanding payments.
Jenny, who has worked in the industry for the past 20 years, said: “Large firms around the country, especially well-known retailers, are making changes to their payment agreements with suppliers, resulting in ‘negotiating extended terms, sometime up to 90 days.
Small traders are then left with no option but to accept these terms and the businesses involved avoid blacklists, such as the FSB’s.
“These traders are extremely important in today’s society so they need to be looked after in the right way, instead of being faced with ‘bully boy’ tactics.”
Jenny also added that targets set by the government to pay their suppliers within 10 days is unrealistic.
She said: “Considering the bureaucracy that local government goes through before approving an invoice for payment, it is unlikely that this time frame is an achievable target.
Our clients are still suffering from delays in payment from local councils and government; perhaps a more realistic target would be 30 days.”
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