Small businesses are struggling to make ends meet as they wait for an estimated $7.4 billion in overdue payments.
The latest Xero Small Business Insights estimates half of small businesses are owed at least $7,000 on any given day, with half of the overdue invoices at least 16 days past due on average.
Xero New Zealand managing director Craig Hudson said it was a staggering amount of money, with the proportion of businesses reporting late payments rising to more than 79 percent in May and June, from 77 percent in March.
“It’s unfair that there is a lot of Kiwi small businesses out there waiting too long for money that’s rightfully theirs.”
He said there was also a slight uptick in the average amount of overdue invoices per firm, which was making it difficult for businesses to pay suppliers, staff, rent and other bills.
“We hope sharing (these) figures will make late payers, particularly bigger firms, aware of the burden they’re imposing on small firms and the wider economy, and encourage them to adopt quicker, more reliable payment practices. It’s certainly something we are investigating with our own payments, to ensure we practice what we preach,” Hudson said.
Accommodation and food service businesses were the most affected by late payments, with a third of their invoices overdue.
This article was originally published on RNZ and re-published with permission.