delayed payments during lockdown and its effect on SMEs
Businesses! Are you seeing delays in customer payments due to the lockdown? Then check out the possible solution that you might be looking for.
Since NSW went into lockdown on June 26, followed by Victoria, South Australia and Western Australia, small and medium businesses across the country have faced a significant delay in invoice payments (Illion 2021).
According to the latest report of Illion (2021), since January 2021, the number of late payment days has been steadily worsening.
construction and transportation firms are falling behind on their financial obligations.
Since April 2020, the construction sector’s late payment time has risen slightly to 10.8 days and is still climbing. Although the government sector building is being supported, the shortage in materials and the wobbling economy are hindering the industry’s recovery.
Meanwhile, the late payment period of the transportation sector is calming down after the 22.5% soar in June 2020. However, it will require a significant time to bring it back to the pre-pandemic rate of 8.5 days for late payment.
the pandemic affects micro-businesses badly
Since June 2020, companies with five or fewer employees have been facing significant issues in funding, which is indicated by the increased late payment time from 9.8 days in June 2020 to 10.6 days in June 2021.
Younger businesses that entered the market for less than 20 years also face an increasing trend in late payment time. The younger the companies are, the worse the late payment time is, and 2-5 years old firms have the peak late period of more than 14 days on top of their normal payment times.
thornmoney solution: don’t let delayed payments hinder your business from flourishing
If you own a small or medium business, you might notice that the payments are getting more delayed since the lockdown. Don’t let these lags affect your cashflow management which can obstruct your business bounce back!
Thornmoney’s invoice finance solution allows you to turn unpaid invoices into fast funds within 24 hours. With no lock-in contract, it is as simple as connecting your accounting software with our platform.
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