Small and medium-sized enterprises (SMEs) are continuing to suffer because of the UK’s culture of late payments, figures have revealed.

Close Brothers, which published the report, also found that more than two-thirds of SMEs feel that late payments are a part of doing business in Britain.

“Late payments are a very real issue for SME business owners,” says Neil Davies, CEO, Close Brothers Asset Finance.

“In some cases directors are having to defer their own salaries, increase their overdraft or pay their own suppliers late to ensure they remain liquid, causing the vicious circle to continue.”

 “We should also not forget the very real human impact because, in many cases, the ability to pay staff in full and on time is a consequence of late payments,” added Mr Davies.

Close Brothers found that one in four firms have been forced to seek legal advice, with the proportion significantly higher in certain sectors.

Its report found that some 78 per cent of transport firms are affected by late payments, alongside 74 per cent of manufacturing firms and 73 per cent of printers.

But around three-quarters of SMEs believe that current legislation is not suitable to support small businesses and instead favours large conglomerates.

“What these results confirm is that late payments are not merely a regional or sector issue, but one that is felt across the SME community,” said Mr Davies.