BACS Tips
Helping you avoid late payments
According to Bacs, 59% of SME’s experience late payment problems. The following handy tips will help you manage the headaches that inevitably arise when dealing with late payments:
- Credit check clients and suppliers up front. If you knew a company had experienced financial problems in the past, would you still give them 30 days' credit?
- Once you have signed a contract with a trading partner, encourage them to pay all invoices straight into your bank account. This small step can save time on payment reconciliation and queuing at the bank to pay in cheques.
- If people are good at paying you, why not reward them? Offer discounts for prompt or early payers encouraging them to keep the money flowing in.
- Practice what you preach! Save your own suppliers time and money by paying them and settling your business bills by Direct Debit. This approach could help you negotiate better payment terms and avoid penalty charges on any overdue invoices or bills.
- Get familiar with UK business law, especially if you have customers that frequently pay you late. In the UK, all business owners and managers are entitled to claim reasonable debt recovery costs and Statutory Interest under late payment legislation.
The first quarter of the 2007/08 financial year got off to an exceptionally busy start. As well as the usual round of financial tasks, there has also been a new wave of business legislation coming on stream that SME’s need to be aware of - for example increases in maternity entitlement plus changes brought about by the smoking ban. With so much for business owners to think about, we want to help them keep late payment issues at the top of the agenda.Michael Chambers, Managing Director at BACS
For more information on how to secure your payments, read about our Electronic Funds Transfer services, or contact us directly online.
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Ceridian provides this information to its customers and friends for general information
purposes only. This information should not be construed as Ceridian providing legal, tax or other advice
to any specific individual or organisation. Please consult your appropriate adviser for specific advice.
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