Liquidity is the blood of businesses. They rely on predictable flows of cash, to operate, survive, and grow. This is particularly true for SMEs, who do not have the same level of access to finance as larger businesses or public authorities do.
Unfortunately, payment delays are still deeply embedded in our business environments. Only 40% of businesses are paid on time in the EU. Late payments account for 1 out of 4 bankruptcies. “Late payment” is the most pressing item of concern for SMEs and start-ups, after administrative burden and red tape. Very often, paying late is an intentional practice, rather than an unfortunate incident.
COVID-19 has exacerbated this situation. Payment durations have deteriorated and the number of excessive payment delays (i.e. more than 30 days) has increased across all sectors. For an SME, now, being able to cash its invoices on time makes the difference between survival and bankruptcy. Besides, liquidity is essential to build up the resilience of businesses and support their twin digital and sustainable transition.
Therefore, now, more than ever it is important to tackle the issue of late payments as effectively as possible. To do this, it is necessary to rely on regular, comparable and exhaustive streams of data and information on payment behaviour. This is why the SME Strategy (COM 2020 103) pointed at the need to set up an EU Observatory to monitor timeliness of payments by public authorities and businesses in the EU, and understand better the causes behind payment delays. This knowledge will be a valuable support for the Commission and the Member States, for combatting late payment in commercial transactions.
During this webinar, you will have the opportunity to listen to concrete practices of EU Observatories and monitoring at work. Subsequently, there will be an interactive session. The objective is to be able to collect your experience, and views in the best possible way.
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