Late bills were settled two and a half days more quickly by end of the year

UK businesses had significantly improved the time taken to settle their bills by the end of 2009, the Late Payment Index from Experian has revealed.

December last year saw businesses paying their late bills an average of 20.88 days after their agreed terms – an improvement of over two and a half days from 23.54 days in December 2008.

Improvements have been noted monthly since August 2009, with the biggest improvements coming from the UK’s largest businesses – those with 501 employees plus. Their payment dates reduced on average from 36.10 days late in January 2009, to 28.97 days by December 2009.

However, 2009’s payment performance was noted by Experian as being “marginally worse” than that of 2008, when 21.51 days was the average, compared with 22.79 days after agreed terms in 2009.

Head of commercial credit at Experian’s business information division, Joe Myers said: “The fact that the country’s biggest businesses reduced the time it takes to settle their bills by nearly 20% is a significant turnaround.

“Companies are more aware now than ever that their credit score is affected by their payment behaviour. It means other businesses can make a more informed decision about working with them.”