The prevalence of late payments has been a nationwide issue, with SMEs experiencing 36% of their monthly payments as overdue. London's SMEs are the most affected, with 41% of their payments delayed.

SMEs, which make up 61% of UK employment and are crucial to the economy, have observed a 55% increase in late payments over the past six months. This trend exacerbates the already rising costs of business operations.

Almost half (46%) of small businesses cite the time spent chasing invoices as a significant impact, with 31% dedicating 21-30 hours monthly to this task. This time, ideally meant for enhancing customer service, developing new products, or strategizing business growth, is often consumed in recovering already-earned revenue.

Cashflow disruptions are another major consequence of delayed payments, with 44% of businesses identifying it as a pressing issue. SMEs are especially susceptible to the effects of unstable cash flow, which can hinder business planning and jeopardize their ability to pay suppliers, staff, and retain clients.

Payit by NatWest offers a straightforward and rapid solution for businesses to collect payments without needing customers' card details. The system facilitates near real-time settlements to address cash flow problems and offers a simple, secure process for customers. Currently, 55% of SMEs receive payments via bank transfer, and 33% through card payments.

Customers often delay payments unintentionally, with 41% forgetting to make the payment and 21% struggling to find correct account details. Payit’s QR code generation feature provides an easy digital payment collection method.

Mike Elliff, CEO of Payit by NatWest, comments: “Small businesses are crucial for growth and innovation, but they're losing valuable time and money. Reliable near real-time payments can make a significant difference.

“Payit’s platform, underpinned by Open Banking technology, is designed to simplify and expedite payments for businesses and consumers. To date, Payit has processed over 10 million payments, proving its reliability for business owners nationwide.”

Terry Corby, Founder and CEO of campaign group Good Business Pays, adds: "The findings from Payit's research are alarming and underscore the need to address the unjust practice of late payments to SMEs.

“Approximately 40% of SMEs rely entirely on B2B sales, meaning nearly 2.5 million SMEs endure long waits for payment for goods delivered or services rendered. We must acknowledge that small businesses are not just businesses, they represent people's livelihoods.

“Assuming each of these businesses has one employee, late payments affect the cash flow of 2.5 million families. If they have two employees, then it impacts 5 million families in the UK. As the festive period approaches, it’s imperative for companies to pay on time."