Large businesses could be fined by this new late payment law
Sometimes a few large businesses can act nasty and can delay the payments which may be utmost necessary for the creditors who may have small businesses. To resolve this issues came this new late payment law.
Research from the Federation of Small Businesses (FSB) shows that roughly 50,000 small companies close every year because of late payments.
Previously, business groups had raised concerns that the only powers the commissioner had were to highlight bad practices. In an attempt to make payment practices more transparent, the government made it mandatory for large businesses to publish their payment data twice a year, however this was also criticised, as it was pointed out that the raw format of the data makes it hard to use.
Mike Cherry, national chairman of the F SB, quoted: “We know that paying small businesses late is debilitating, and the practice has
increased during Covid-19. It deprives small firms of cash flow, holds back growth, undermines productivity and forces many to take out external finance. In thousands of cases a year this causes the closure of small businesses.”
More than anything else, it becomes mere humanity to understand everybody's plight and circumstances and make the due payments on time so that no one is affected in business. Maintaining mutual respect is vital and basic practice that should be followed by all businesses.
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