The Real Cost Of Late Payments For UK SMEs

Estimated reading time: 1 mins

Running a business is difficult enough without having to worry about chasing payments. Unfortunately, late payments are one of the most potent threats to the success of small and medium-sized companies in the UK. The infographic below shows the scale of the problem, with UK SMEs owed £23.4 billion in 2019.

The impact of late payments is more dramatic than before, with the total debt owed to UK SMEs increasing by over £10 billion since 2018. Companies are now spending £4.4 billion every year following up unpaid invoices and collecting outstanding payments. One of the main issues is that businesses often work together, depending on a chain of events to make payments on time. Around 80% of private sector late payments are owed by SMEs to other small businesses. Delays create a domino effect, leaving a network of companies facing difficulties. 

Late payments affect over half of UK SMEs (54%) and the consequences can be far-reaching. Thirteen percent of small and medium-sized enterprises struggle to pay bills, 12% have difficulties covering wages and 10% depend on invoice finance. 

The implications of outstanding payments should not be underestimated. Approximately 50,000 companies fail each year in the UK as a result of late payments, with those operating in wholesale trade, administration and support and transport and warehousing worst affected. Other industries that are hampered by unpaid debts include public administration and safety, electricity, gas, water and waste, finance and insurance and manufacturing.

The average UK SME has a late payment debt burden of £25,000. 

Infographic Design By SME Invoice Finance


About the author /

Simon is a creative and passionate business leader dedicated to having fun in the pursuit of high performance and personal development. He is co-founder of Applied Change, a Business Change consultancy based in the UK. Simon is also an Ambassador for Gloucestershire business. Simon is an Associate Member of the Chartered Institute of Professional Development.

Post your comments

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Affiliate Promotion is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon, the Amazon logo, AmazonSupply, and the AmazonSupply logo are trademarks of, Inc. or its affiliates.


When answering Employee surveys, do you always answer completely honestly?

View Results

Loading ... Loading ...
My latest book: ACE Your Performance Appraisal$4.99 on
How Am I Doing?

Did this discussion solve your problem?

Then please rate this post or leave a comment.