Highlights of the 10th Assises des délais de paiement et des financements conference

The 10ᵉ edition of the Assises des délais de paiement was held on November 9, 2023 at the Banque de France offices in Paris. A few highlights from this plenary session.

The Governor of the Banque de France, François Villeroy de Galhau, began the meeting on a positive note, highlighting the progress made in the fight against inflation, with the aim of bringing it down to 2%.

He also pointed out that the Banque de France had downgraded the FIBEN rating of 635 large companies for non-compliance with payment deadlines.

Late payments

As regards late payment, the average for all sectors combined is 14.5 days, with marked disparities between sectors. In the construction sector, payment delays are well above the national average.

VSEs and SMEs stand out positively in terms of payment behavior, while late payment persists among Intermediate-sized Companies and Large Enterprises, exceeding the national average.

Although the link between high levels of late payment and business failure has never been proven, a steady deterioration in late payment is seen as a strong signal of cash flow pressures and, potentially, business risk.

Some companies face unintentional cash flow pressures, while others deliberately choose to pay poorly to improve their own cash flow.

Olivia Grégoire, Minister Delegate for SMEs, Trade, Craft Trades and Tourism, announced that the government was working on new measures to eliminate bad practices, highlighting the intensification of "Name & Shame" vis-à-vis bad payers, with financial penalties now systematically added to reputational sanctions.

Collective proceedings

Jean-François Doucède, Vice-President of Infogreffe, was reassuring about the future of collective procedures.

Nevertheless, there are a few concerns about the situation ahead:

• a 22% increase in the number of companies identified as being in difficulty in Q3 2023... An increase that could be amplified by the repayment of PGEs.
• a sharp drop in the number of annual accounts filed (-19%).

These two factors combine to create growing uncertainty in business relationships.

Electronic invoicing

Despite the postponement to September 1, 2026 of the generalization of electronic invoicing, Nicolas Floriou, President of theAFDCC, urges companies to mobilize as a matter of urgency, underlining the considerable scale of the task. Although e-invoicing is not a miracle solution for eliminating late payments, it is clear that it will be a lever for improving the situation.

The example of Italy, which made e-invoicing mandatory for all private players between 2018 and 2019, is significant. The average payment delay in the country fell from 19 days in 2018 to 17.5 days in 2022. This reduction, albeit gradual, has been maintained in a context similar to that of France, marked by the pandemic, inflation and moderate growth. Italy has thus broken through its glass ceiling.

And what about the EU?

Antonella Correra illustrated with a few figures that the problem of late payment is encountered in all European countries. She also outlined the European Union's (EU) proposal to harmonize payment practices and reduce late payments.

Although some of the measures in this proposal are considered interesting, such as automatic payment of interest and lump-sum compensation, as well as training, the main measure is controversial. The idea of capping the maximum payment term at 30 days, with no possibility of derogation, is causing concern and even rejection on the part of various economic players, including certain trade federations.

If adopted, this obligation would present a tangible risk for certain business sectors and have consequences for SMEs in the short and medium term. On this subject, CPME President François Asselin drew attention to a regulation in force in the Netherlands since 1ᵉʳ July 2017, prohibiting a payment term of 60 days from being exceeded in specific situations, notably when a contract is concluded between a large company acting as buyer and an SME acting as supplier. Perhaps an interesting avenue for rebalancing the balance of power in the commercial relationship?

LATE PAYMENT INDICATOR BY BUSINESS SECTOR IN FRANCE

PayTREND (Ellisphere indicator): average late payment indicator in number of days of invoices paid and not paid after due date.

See Alain Luminel, head of Ellisphere's financial expertise division, speaking at the Assises de délais de paiement et des financements ???