Business late payment times had their sharpest increase in 10 years, illion reports in its June quarter Late Payment report.
Business-to-business payments are being made an average of 10.8 days late – an increase of 8.4 per cent from the March quarter and an increase of 7.7 per cent compared with the same period last year.
Late payments are nowhere near the 20-day average in June 2011 but the sharp rise is notable, illion said. illion’s data is drawn from its commercial bureau database.
“The effect of the COVID-19 pandemic on Australian businesses is becoming increasingly apparent, with month-on-month increases in late payment days since April,” the report said.
The sector with the highest number of late payment days is mining, with 16 days on average. The sector’s late payment days increased by 26.3 per cent year-on-year.
In the retail sector, late payment days rose 5.9 per cent year-on-year to 13.6 days. In manufacturing the increase was 10.3 per cent to 13 days, in wholesale it was 18 per cent to 12.6 days and in services it was 13 per cent to 9.8 days.
All states and territories recorded increases. Tasmania was hardest hit, with a 17.6 per cent increase quarter-on-quarter to 9.9 days.
The bigger the business the longer it takes to pay its bills. Companies with more than 500 staff were late by an average of 16.8 days – an increase of 16.4 per cent year-on-year.
Companies with 50 to 99 employees increased their late payment days by 17.8 per cent to an average of 11.3 days and companies with six to 19 staff increased their late payment days by 17.2 per cent to 10 days.