New plans revealed to save small firms £22,000 a year and improve access to cash

A new ‘Fair Payment Code’ is being launched to address the problems with late payments, with research showing that SMEs are on average owed £22,000 a year.

The code, overseen by the Small Business Commissioner Liz Barclay, introduces a gold, silver, and bronze system to reward best payment practices and help smaller firms identify reliable and trusted partners. It aims to boost cash flow for small businesses which is crucial for their survival, by tackling late payments and lengthy payment terms that can lead to financial strain and failure.

Businesses can sign up from the 3 December.

Liz Barclay, Small Business Commissioner said: We want suppliers paid within 30 days with payment beyond the due date a rare event. We want longer contractual payment terms to be recognised as potentially detrimental to vital supply chains. We want businesses of all sizes to commit to fair and quick payments and to avoid harmful disputes. This new Code will drive a better payments culture and benefit everyone.

The package also includes a shared initiative with leading banks, to support disabled entrepreneurs to access the finance required to start their own firms. Barclays, HSBC UK, Lloyds Banking Group, and NatWest have all signed up to this new scheme committing to improve access to finance products, improved mentoring, for entrepreneurs, showcase more disabled success stories and to actively support disabled representation in their firms. 

As part of a wider pledge to support retail businesses and convenience stores, the Home Office is set to hold the first meeting of the Retail Crime Forum today to discuss ways of tackling crime on high streets and dealing with threats against retail workers.

The meeting follows the government’s commitment to introduce a new specific offence of assaulting a retail worker, and ending the effective immunity that currently applies for theft of goods under £200. In addition, increased funding of £7m over 3 years to policing will help tackle retail crime.

Also announced, is action to recognise the untapped potential of female-led businesses in the form of a new partnership between the organisation Female Founder Finance and UK Export Finance. This will offer no cost services to improve access to finance and helping them grow their networks, making sure more women can seize vital opportunities to scale up achieve their business goals. 

Thriving small businesses are essential for the growth mission and for communities across the UK. That’s why the Budget protected a million small firms from National Insurance increases and extended business rates relief. Taxes on retail, hospitality and leisure sectors are permanently lower from next year supporting small businesses across the country.

In addition to this, the Chancellor announced an extension to the Employment Allowance to a record £10,500.

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