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Payment times on the rise again

Published on March 26, 2024 by Pierre Belhache - 6 mins reading time
SMALL BUSINESSES Companies Invoices Self-employed Mediation

Over the past few months, payment delays have been mounting for very small businesses, whereas in the years preceding the Covid-19 crisis, they had been falling by one day a year, to an average of 10 days. Find out more about the rise in payment delays and the solutions being considered to remedy the situation.

Slight deterioration in the number of days late payment

In France, payment times will rise from an average of 12 days in 2022 to 15 days in 2023, according to the 501 companies with over 50 employees surveyed by IFOP last October. ARC's annual barometer showed that a third of managers surveyed were experiencing increased delays in paying their invoices, compared with 22% the previous year.

 

This slight deterioration in the number of days overdue is explained by the events that followed the health crisis, namely soaring raw materials and energy prices, inflation, geopolitical tensions and recruitment problems.

 

Tougher sanctions in the coming months

" Today, we have very small businesses failing in certain sectors, such as construction. They're failing because they're not being paid on time," said Olivia Grégoire, Minister Delegate for Business, on March 22, 2024.

To reduce payment delays, which have a major impact on the cash flow of very small businesses, the member of the government has confirmed that sanctions will be stepped up in the coming months. By mid-April, companies will have to " publish their payment terms for local authorities with more than 3,000 inhabitants ". This measure could be extended to all public establishments. The government does not rule out the possibility of communicating on these bad payers.

 

Generally speaking, the French government intends to strengthen its control tools. On the one hand, the crisis committee on payment terms has been maintained. Secondly, the Banque de France now includes payment behaviour in its company ratings. Last year, more than 1,000 companies were downgraded, compared with 250 in 2022.

 

Mediation, an alternative dispute resolution method

In addition to tougher sanctions, mediation between French companies will be encouraged. Faced with the crises experienced by these players, dialogue and support are essential. When questioned on the subject, Pierre Pelouzet, the company ombudsman, explains that the aim is tobalance the dialogue between smaller companies and large groups in the case of energy supply disputes. The solution does not always involve cancelling the contract, but may involve staggering payments or analyzing consumption.

A genuine tool for dialogue and co-construction, the Corporate Ombudsman is experiencing a sharp increase in activity. In 2023, its teams handled 4,300 requests, compared with 3,677 the previous year. The system has expanded since the health crisis, with 22,000 requests handled in 4 years, more than doubling the number of mediations carried out between 2010 and 2019.