BANK OF IRELAND BUSINESS BANKING SURVEY SHOWS DOUBLE AND LATE PAYMENT OF INVOICES SERIOUSLY AFFECTING BUSINESS CASHFLOW

The results of a recent survey conducted by Bank of Ireland Business Banking show that Irish businesses are being severely affected by the late payment of invoices. This is despite the introduction of legislation 2 years ago to ensure timely payment. The results of the survey also show that a large percentage of businesses are paying suppliers twice for goods and services provided.

The survey, conducted amongst Bank of Ireland Business Banking's customer base, shows that late payments are an issue for 4 in 10 companies. The results also show that the shorter the payment terms the higher the incidence of late payment. On average, payment terms of 0-30 days were exceeded by 18 days, while payment terms of 31-60 days were exceeded by six days.

Two thirds of respondents said that the delay was intentional, while 39% of respondents indicated that it was due to their own debtors experiencing financial difficulties. One quarter blame disputes regarding goods and services delivered and almost a third of respondents put it down to inefficient internal follow up. Two thirds of customers felt that enforcement of recent legislation would help resolve late payment issues and 45% of respondents said that improving their own credit management systems would also help to alleviate the problem.

The survey results also highlights the fact that double payment of invoices is adding to cash flow problems for businesses. Nearly one quarter of businesses surveyed admitted to paying suppliers or service providers twice. Of those,
6 in 10 had lost up to Euro1,000 a year, 2 in 10 had lost between Euro1,000 to Euro5,000,1 in 10 had lost between Euro5,000 to Euro10,000 while 1 in 10 had lost over Euro10,000 through double payment. The main reasons given for double payment were errors in internal bookkeeping and duplicate invoicing.

Commenting on the findings of the survey, Mr. Dermot Nolan, Head of Business Marketing, Bank of Ireland said, 'The results of this survey show that late and double payment of invoices are serious issues for Irish businesses. Both are putting unnecessary pressure on business cashflow. We understand that businesses won't see the benefit of increasing sales if payment is not received on a timely basis. This ultimately has implications for liquidity and the businesses ability to pay regular bills such as wages and suppliers".

Ends

For reference:
Anne Mathews
Media Relations Manager
Bank of Ireland Group
Tel: 01 6043836 / 087 2460358

Dermot Nolan
Head of Business Marketing
Bank of Ireland Business Banking
Tel: 01 604 3349 / 086-2429167

About Bank of Ireland Business Banking
Bank of Ireland is the number one Bank for business in Ireland with dedicated business managers available through each of its 270 strong nationwide branch network. Bank of Ireland Business Banking now provides almost 100 business loans per day to all types of businesses ranging from start-ups to high-growth firms.

The Bank of Ireland business offer encompasses the full range of day-to-day business banking services as well as specialist Treasury, Commercial Finance, Credit card, Life Assurance planning services and Venture Capital. These business services are complemented by Bank of Ireland's Specialist Business Bank (SBB), a dedicated unit which assists Bank of Ireland branches and customers with more complex and specialist financial packages. Over 60,000 customers have registered for its 'Business On Line' service.