Northamptonshire Membership organisation NNBN is marking their first anniversary of signing the Prompt Payment Code by encouraging businesses leaders to commit to signing the code and helping to reduce the time in payment of invoices.
The Prompt Payment Code (PPC) sets standards for payment practices and best practice and is administered by the Small Business Commissioner on behalf of the Department for Business and Trade. The Code covers prompt payment, as well as wider payment procedures.
The Small Business Commissioner, Liz Barclay, is responsible for regulation and governance of the Prompt Payment Code and signatories of the Code. The Small Business Commissioner has the power to determine which companies become signatories and investigate complaints concerning any signatories. These investigations can result in the Prompt Payment Code Compliance Board suspending or removing signatories from the Code.
The criteria for joining the Prompt Payment Code is:
- Pay suppliers on time
- Give clear guidance to suppliers
- Encourage good practice
- Pay 95% of all invoices within 60 days
- Pay 95% of all invoices within 30 days where the supplier is a small business with fewer than 50 employees
- Avoid any practices that have an adverse effect on the supply chain
Late payments can have a significant impact on the UK and local business economies and can lead to several negative consequences for business leaders including cashflow issues, increased borrowing costs, stifled growth, operational challenges and ultimately business closures.
NNBN Director Simon Cox said “The UK Government and various business organisations have taken steps to address this issue, but additionally business leaders can also take steps by committing to signing the Prompt Payment Code and helping to reduce late payments.”
“We signed the PPC last November to commit our organisation to our suppliers and are proud that we took this step meaning that payment of invoices to our suppliers are paid on time and often ahead of payment terms.”
“We feel, as an organisation that is active around the Northamptonshire business community, that we should ensure local businesses are aware of the Prompt Payment Code and should consider signing the code to commit to reducing late payments.”
To learn more about the Prompt Payment Code, visit https://www.smallbusinesscommissioner.gov.uk/ppc/