They had shortened in 2021, without however returning to their pre-crisis level, the payment times between companies are likely to increase in 2022. A few additional days which jeopardize the cash flow of the structures. According to a survey published on Tuesday June 21 by the collection company Intrum, six out of ten companies in Europe expect late payments to increase in the coming months.
The reason ? Inflation. A majority of responding companies – 11,000 companies in 29 European countries surveyed between January 14 and April 12 – say they lack experience in the face of the unprecedented price rise of recent months. And 51% of them consider that the rise in prices prevents them from growing, meeting salary demands and paying their suppliers on time.
Deadlines already extended in France
In France, where 600 companies were questioned, payment delays between companies (B to B) are already getting longer. Thereby, “the difference between contractual and actual payment terms is 17 days in 2022 compared to 11 days in 2021”, details Intrum. The company states that “83% of French companies have agreed to extend their payment terms in 2022” including a majority to avoid the risk of bankruptcy, and 77% “to sustain their relationship with their suppliers”.
On the contrary, late payments of invoices to end consumers (B to C) have decreased, while those of public services to businesses have on the contrary exploded, going from 9 to 23 days, Jean-Luc Ferraton told AFP. CEO of Intrum France.
While payment deadlines had been protected by cash aid, in particular state-guaranteed loans (PGE), during the health crisis, repayments of these same loans, added to tensions on supplies and price increases , are putting companies under pressure today. Faced with this situation, eight in ten respondents say that strengthening liquidity is among their strategic priorities for 2022, according to the survey.
At the end of the day, the risk of bankruptcy
Non-compliance with payment deadlines is “a proven risk which is responsible for a quarter of bankruptcies in France”, emphasizes Jean-Luc Ferraton. According to figures reported by the Banque de France on Monday, business failures are experiencing a moderate increase, while remaining at a level significantly lower than that which prevailed before the health crisis.
In May, 32,109 companies thus declared an insolvency, or 9.2% more than during the previous 12 months. During this month, the number of failures “remains close to 3,000, as overall since the beginning of the year”said the institution.
Thanks to public aid to relieve the cash flow of companies during the Covid-19 pandemic and the temporary suspension of certain procedures by the commercial courts, the number of insolvencies in France had fallen to around 27,000 in 2021, against more than 50,000 per year. year before the health crisis.
“Normal” increase in future failures
The gradual phasing out of these support systems put in place by the State should lead to an increase in business insolvencies in the coming months. “We will have to expect an increase in the loss ratio”, declared last week the president of the CPME François Asselin.
“What is going to happen is normal even if it is dramatic” for the business leaders concerned, he tempered. And to add: “What we don’t measure is speed” at which point the default curve will begin to rise again. “If at the end of all this, we have a loss ratio that stabilizes around 50 to 60,000 companies, frankly (…), we will have cushioned these consecutive crises,” he concluded.
According to data from the Banque de France, corporate insolvencies have been up slightly each month since February.