FPB uncovers cash flow and late payment concerns

12th July 2013

Cash flow and late payment concerns are on the rise, according to new research by the Forum of Private Business (FPB).
Their latest study revealed a worrying increase in the number of small firms who were concerned that banks may 'call in' existing overdrafts or loans.
Phil Orford, chief executive of the FPB, believes the continued lack of affordable lending from banks to small businesses has caused this "alarming" shift in confidence.
"Taken in a wider context, these results are alarming, because it suggests a marked deterioration in SMEs’ confidence in their finances," he said.
"We suspect this is a result of the banks’ on-going failure to deliver affordable finance to small firms.
"The fact that businesses are increasingly worried about cash-flow and being paid late is surely linked. These are issues borne of credit being scarce and difficult to obtain – the recently announced OFT investigation into the lack of business lending by the banks underlines this."
Additional research by the FPB found that more than half of small firms polled were keen to use the organisation’s Credit control guide to improve their management of cash-flow.
Mr Orford added: "Everybody knows cash-flow and credit control are crucial areas for all businesses.
"Those that successfully manage these aspects of their business are better placed to survive a one-off shock and more likely to be in favour with the banks for a loan. Our Credit control guide is a great starting point for businesses that feel they are wanting in this area."
Cash-flow projection is undoubtedly one of the most integral management reports for any small business as it demonstrates the amount of cash flowing in and out of the business and how much capital investment a business needs.
At TaxAssist Accountants we are capable of providing SMEs with an accurate and comprehensive service to suit any business’ or lenders’ requirements.
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