Late payment legislation viewed as a deterrent by businesses
Research conducted by the Better Payment Practice Group (BPPG) during October indicates that the overwhelming perception of the Late Payment of Commercial Debts (Interest) Act is that, first and foremost, it should be used as a deterrent.

The web poll, conducted on the BPPG website www.payontime.co.uk, asked whether the most important and effective application of the legislation was either applying for and obtaining compensation for late payment, or using it as a deterrent on invoices and reminders. 68% of the 739 respondents said that the use of the legislation as a deterrent is its most important and effective role.

Clive Lewis, Chairman of the BPPG and BPPG representative for the Institute of Chartered Accountants in England and Wales, commented:
“ This view is consistent with the original aims and objectives of the legislation. By consistently including a wording on use of the late payment legislation within terms and conditions, reminders, statements and invoices, businesses can send a clear signal to their customers that they are unwilling to tolerate late payment.”

The BPPG has a standard wording that it recommends businesses to include on payment communications:
We understand and will exercise our statutory right to interest and compensation for debt recovery costs under the late payment legislation if we are not paid according to agreed credit terms.

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