A strong deterioration in the trade credit risk landscape for UK companies was shown by a series of trends in our survey. One major issue was a marked increase in late payments and bad debts.
The Atradius Payment Practices Barometer is an annual survey of business-to-business (B2B) payment practices in markets across the world. Its findings can give valuable insights into the current dynamics of corporate payment behaviour in B2B trade. It can also help companies doing business, or planning to do so, in the markets polled to identify emerging future trends in the payment practices of B2B customers.
The 2023 Payment Practices Barometer survey for the United Kingdom was conducted between the end of Q1 and the beginning of Q2 2023. Its findings should therefore be viewed with this in mind.
Key takeaways from the report for the United Kingdom
Rise in payment defaults amid tough domestic economic climate
- Late payments stand at an average 50% of all B2B invoiced sales for United Kingdom companies, a rise of 25% on last year. The level of bad debts increased by 80% and now affect 9% of all B2B sales, an indication of serious cashflow issues.
- The deteriorating credit risk landscape is highlighted by insolvencies standing at 120% ofthe pre-pandemic levels of 2019. United Kingdom companies responded by strengthening credit control procedures.
Insolvency fears fuelled by concern about low-growth landscape
- The current challenging economic landscape, and in particular the expectation of low domestic growth in the year ahead, is the major concern for companies polled across all sectors in the United Kingdom. The strong fear is that this could push the level of business insolvencies even higher during the year ahead.
- 27% of companies polled expect a severe worsening of payment behaviour in the year ahead, compared to just 12% last year. This sentiment was expressed across all sectors. 40% of businesses said they anticipate little or no change in payment practices, while 32% believe there is some room for optimism during the coming months, down from 56% a year ago.
Interested in finding out more?
Please download the full report for a complete overview of the 2023 survey findings of the Atradius Payment Practices Barometer for the United Kingdom.
For a complete overview of the survey results for Western Europe, please download the full report available in the Related documents section below. The Statistical Appendix to the regional report is also available for download in the section below.
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