New research from Experian, the global information solutions company, reveals that there has been an increase in the time it takes UK companies to pay their bills.  UK companies are now taking longer to pay their bills than at any time since legislation to combat late payment was introduced in 1998.

Overall, businesses are taking more than two months – 61.07 days – to pay their bills, an increase of almost two days since November 2006  (the greatest rise since records began in 1998). Large companies are now taking 81.5 days to pay their bills, 21.2 days more than small companies.  Medium-sized companies are now taking 61.3 days – one day more than they did six months previously – whilst small companies are taking two more days, at 60.2 days. Experian’s findings are based on the payment patterns of more than 435,000 companies.

Jo Howard, marketing director of Experian’s business information division, said: “Information on how long it takes for businesses to pay their bills is very powerful and is a great asset for improving business efficiency.

“Businesses need to be increasingly cautious about trading with companies that have a poor or erratic payment performance record.  More alert companies are more likely to take steps to screen out poor performers from their new business activity and check for default or late payment amongst new and existing customers so they know who they are dealing with and are forewarned of any potential problems.

“At the same time, they might be trading with a very creditworthy and sound business that has a culture of payment.  It pays its bills, but traditionally later than its peers in its industry. Here, a business can be prepared for late payment or take steps to change its payment terms to encourage faster payment or develop more creative collection strategies.”