Large businesses must now pay their smaller suppliers more quickly under changes to the UK’s Prompt Payment Code (PPC).
Big businesses signed up to the PPC must pay small firms with fewer than 50 employees within 30 days instead of the previous 60 days. The Code currently has more than 2,800 signatories.
The Federation of Small Businesses (FSB) recently revealed that almost 50,000 small firms have to close each year because of late payments. According to the FSB, the issue has become more prevalent as a result of the coronavirus (COVID-19) pandemic.
Commenting on the matter, Philip King, Interim Small Business Commissioner, said: ‘Late payment causes real hardship to small businesses, and the issue is more prevalent than ever due to the continued impact of the pandemic.
‘Code signatories of all sizes demonstrate their commitment to ending the culture of late payment and helping to increase business confidence.’