Businesses often wonder how effective a Letter Before Action (LBA) actually is compared to sending their own warning letters to their debtors. After reading this guide you will uncover the true reasons as to why LBAs are so effective
Late payment remains one of the biggest problems for UK businesses. However, late payment law is available to protect businesses from late paying customers.
On 2nd November 2017, the Bank of England increased the base rate of interest from 0.25% to 0.5%. This is the first time that interest rates have been increased in more than a decade.
When the Late Payment of Commercial Debts (Interest) Act 1998 was introduced it had two clear purposes.
The first was to ensure that creditors were properly compensated for the late payment of any debts, and the second was to avoid late payment being an issue in the first place.
You get to the end of your credit control procedure and you still have some unpaid accounts, so, what are the options?
The Government has published their proposals to require large companies to publish their performance when it comes to late payment. This comes after repeated surveys show that UK business is still dragging it's feet when it comes to paying invoices on time - one recent survey showed that 39% of all invoices issued in the UK are paid outside of terms.
Imagine this situation: a sales person has skilfully closed a high-value deal, only to allow the customer to dictate payment terms at the last minute. Oooooops…
When it comes to payment disputes it's easy to take things personally. After all, you've kept your side of the bargain and the non-payment can feel like a slap in the face.