Risks of Late Payments in Europe Likely to Increase, Reports Intrum Justitia Survey
Nearly half of European business managers (46%) predict increased risks of late payments in the coming 12 months, according to Intrum Justitia’s 10th annual survey European Payment Index (EPI 2014). Business managers in Germany, France, Spain and Poland are more pessimistic than they have been in five years.
The national trends are diverging with many low-risk countries reporting fewer risks ahead, while the majority of business managers in high-risk countries believe it will get even worse during the rest of 2014.
The highest risk forecasts were expressed in Portugal, where 82% of the managers predict that the risk for late payments will increase during 2014, with high numbers also for Greece (74%), Romania (73%), Spain (65%) and Italy (65%).
Nordic countries such as Denmark, Norway and Sweden are low-risk countries for credit managers and in those countries very few business managers claim that the risks are likely to increase. But Finland moves in the opposite direction: their business managers are more pessimistic than they have been in five years with 40% predicting more risk of late or non-payment.
“Europe’s recession may well be over officially, but it continues to have a dire impact on businesses, communities and people within and beyond the European Union,” says Lars Wollung, President and CEO of Intrum Justitia. “Generally business managers are more pessimistic about their risk forecasts than they have been since 2009, which was a year with extreme uncertainty regarding the future. It is of vital importance that businesses have credit management processes in place in order to secure liquidity and rebuild business confidence.”
In the report, Intrum Justitia lists what measures businesses can take in order to improve their cash flow and prevent bad debt losses: