Firms having late payment problems

The Late Payment Index from information services company Experian, revealed a significant decline in payment performance occurred among UK businesses of all sizes towards the end of 2010 as the bad weather took its toll.

Late payment problems were particularly pronounced for small businesses in Yorkshire and the North East. On average, Yorkshire firms paid their bills 24 days late in 2010.

Experian's analysis found that while the average payment performance for 2010 as a whole saw a small improvement from 22.81 days in 2009 to 22.58 days, payment performance deteriorated during the final quarter of 2010, with firms paying their bills 25.70 days late - the highest recorded average since the third quarter of 2007.

Businesses with more than 500 employees took the longest to pay their bills, but the biggest decline in performance during the last quarter of 2010 occurred within the small to medium enterprise sector.

Jason Mills, head of payment performance at Experian UK & Ireland, said: "Although overall payment performance improved slightly during 2010, the final few months of the year have highlighted that businesses still need to be cautious. The bad weather played a key role in this downward trend with many firms closing as employees struggled to get into their offices."