Sole traders suffer £8.1bn a year in abandoned late payments
UK self employed hit by an average of £2,473 in abandoned payments every year
The UK’s sole traders are being hit with up to £8.1bn in abandoned late payments, according to research from Paym.
Nearly one million self-employed individuals were affected this year after being forced to give up chasing payments from their customers, costing cash flow-reliant sole traders an average of £2,473 each.
The study also discovered that abandoned payments are on the rise. The proportion of UK sole traders that have abandoned payments rose from 23% in 2015 to 30% in 2016, equating to 990,000 businesses.
By region, the South West is the hardest hit with 37% of sole traders giving up payment they are owed. By contrast, just 21% in the midlands have been forced to abandon payments.
Even when customers are prepared to pay, nearly 32% of sole traders have admitted to rounding down payments for customers with incorrect change.
Craig Tillotson, executive chairman of Paym, commented:“It is worrying to see that late payments are a growing problem for Britain’s sole traders. Chasing late payments eats up valuable time, so it’s understandable that an increasing amount choose to cut their losses.