New research from insolvency and restructuring trade body R3 reveals Scottish firms had almost 1.7 million overdue invoices on their books in the last quarter.
R3’s analysis of data provided by Creditsafe shows 1,696,445 invoices were overdue in Scotland in Q3 – an increase of 7.1% from Q2’s total of 1,583,353.
Scotland and the West Midlands saw the biggest quarter-on-quarter rise in overdue invoices across the UK, followed by Northern Ireland (6.9% increase), the East Midlands (5.4%) and East Anglia (5.2%).
And Scottish businesses’ debt burden has been increasing steadily since the beginning of the year, rising from 552,897 unpaid bills in July, to 564,375 in August and 579,173 in September.
Almost 101,500 Scottish businesses reported that they had late payments on their books in Q3 2022 – a figure which peaked at 33,936 firms in September.
Richard Bathgate, Chair of insolvency and restructuring trade body R3 in Scotland, says: “This research highlights late payment is a growing issue in Scotland, and would suggest that businesses are facing ongoing cash-flow challenges, whether that’s supplier or client side …
“For small businesses that rely on regular income, even if just one client fails to pay or there is a delay in payment, that can have a serious effect – and in some cases, may mean they become financially distressed or insolvent.”
Richard, who is Restructuring Partner at Johnston Carmichael in Aberdeen continues: “I would urge the directors of any businesses who are worried about the impact of late payments or are worried about their ability to pay their invoices to seek professional advice.
“There are many steps that can be taken to support businesses, but they can only be taken if you move quickly and act early before the issue spirals.”
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