Wednesday 3rd December, 2014

According to research by Basware and MasterCard, 80 per cent of international businesses are unable to take advantage of discounts for early payment, due primarily to internal payment process bottlenecks.

The research also found that 84 per cent of respondents pay suppliers late, with one of the main reasons being the lack of necessary systems and automation to facilitate timely payment.

Over 1,000 strategic decision makers across Australia, Europe and the US were surveyed to study the dynamics of cash flow and payment processes and their impact on economic performance.

Esa Tihilä, CEO, Basware said, "By having a clear and up-to-date view of the financial status of the business at all times, combined with efficient and automated payment processes, managers can confidently pay suppliers early without any risk."

The research creates a clear picture of the rift that exists, showing that it is not a lack of funds, but rather a lack of capability for businesses to make the most of the savings on offer. While 88 per cent of buyers believe they have a social responsibility to pay promptly, it still takes an average of ten days for payment to take place.

Most invoices are sent and received via PDFs within emails (48 and 50 per cent respectively). Approximately a third (32 per cent) use EDI/XML systems to send invoices and a quarter receive them this way, while web portals are used by 17 per cent of respondents to send invoices and 19 per cent to receive them.

The research also shows that the benefits of timely payment are many and widely recognised. Four out of ten respondents said that it would help reduce credit lines as well as enable them to invest more in their business overall.