Back in February we set up a loan scheme with the international development agency Lend With Care in order to support the growth of businesses around the world.
Our loan was shared amongst four entrepreneurs in Vietnam and Cambodia and was used to purchase animals for rearing, obtain more land for farming, and set up a energy efficient plant for household gas.
So far 17% of our total loan has been paid back, and all of it on time, and no payments have been missed.
If only this schedule of payments could be met by all the other businesses we trade with.
In the UK the standard length of payment terms (i.e. the time a business has between when an invoice is raised and when it is due to be paid) is 30 days, however, the average time it takes a small business to get paid is 71 days!
This delay between expected and actual payment causes immense problems for business owners who need to pay salaries, replenish stock, or plan for growth. For those who can’t fund this cashflow gap through additional loans, overdrafts, or invoice financing face real survival dilemmas.
Some recent research we have undertaken with freelance workers has shown that they face the same problem and 36% of them have even turned to payday loans to overcome the problem.
But it doesn’t have to be like that. If farmers in Cambodia can make their payments on time, why can’t businesses in Canterbury, Colchester, and Cambridge?
At CreditHQ we believe that people should pay what’s due when it’s due, and that’s why our products tell you which businesses pay on time and which don’t, so our customers can make decisions on who they should trust their own livelihood with.