The government is recruiting a small business commissioner to tackle late payment. Good news for SMEs? Or another reason to use invoice finance?

The news that the government is set to appoint a small business commissioner to specifically target the multi-billion pound problem of late payment is cause for cautious optimism. However, small business owners won’t be popping any champagne corks just yet. Recent history is littered with examples of failed attempts to address this SME bête noire.

Perhaps the most prominent example is the Prompt Payment Code. While the premise was good, the failure to get a meaningful number of large companies to sign up has left this initiative dead in the water. Also, there have been plenty official figures that have made sweeping promises but have delivered few tangible results. Small Business Advisor Karren Brady was one to take up the cause but who ultimately came up empty handed in terms of results.

However, perhaps this time things will be different. The specific mandate that will be given to the small business commissioner suggests a greater appetite for confronting the payment challenges that derail SME development. At a time of great market uncertainty and business vulnerability, affirmative action is needed more than ever.

If the new commissioner is going to succeed where so many have failed before, he or she is going to have to be better equipped – the role is going to have to have more teeth. Late payment culprits will need significant motivation to change their ways. Early discussion of the role casts some doubt on what impact the commissioner will be able to have, but the government should be given the benefit of the doubt, for now.

Naturally, SMEs would like the new commissioner to wield some clout, but the continued uncertainty is another strong reason to further embrace non-bank finance and in particular invoice finance. This easily accessible, affordable and flexible service gives small businesses some protection against late payment, which is more than can be said for the many ineffective initiatives.

To find out more about A&T Business Associates services, contact us on 01903 602211 or info@atbusinessassociates.co.uk.