Payment terms will be reduced in 2024, “except for large companies that pay worse”, according to a study published this Friday by the Bank of France. Both the times in which companies collect from their customers and those for payment to their suppliers decreased by 1.5 days, according to this annual study, presented on Friday at the central bank’s payment times meeting.
In 2024, the improvement comes from companies that were already virtuous, but the deadlines for bad payers have been lengthened even further. Large companies were the only ones last year that paid their suppliers more slowly than in 2023, with an average delay of 65.5 days compared to 49.7 for all companies. Half (52%) exceeded the legal period of 60 days.
“Make sanctions more incentives”
“Large companies are at the head of the worst payers,” the governor stressed, again calling for flat-rate penalties to be replaced by a percentage of the turnover, “so that the penalties are more incentive-based.” Large companies received payments from their customers three days faster than in 2023, but paid their suppliers 0.8 days later.
According to calculations by the Banque de France, “SMEs would be the main beneficiaries of an elimination of delays.” He estimates at 13 billion euros in cash what they would have recovered last year without the delays, and at 4 billion euros for medium-sized companies (ETI). On the other hand, if the delays disappeared, large companies would have to transfer 12 billion euros to their trading partners.
The group of “other economic agents”, essentially the public sphere, should transfer, for their part, 5 billion euros. François Villeroy de Galhau wanted “the public sphere to be exemplary” – payment terms must be a maximum of 30 days – distinguishing the State (14.2 days), “on average by good payers”, local authorities (19.7 days) – but 39.2 days abroad – and public health establishments: “63.4 days, more than double the legal limit.”
Source: BFM TV
