Intrum : The dual challenge – firms wrestle with poor payment and customer cutbacks
Intrum : The dual challenge firms wrestle with poor payment and customer cutbacks
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Rising prices and interest rates continue to have a huge impact on Europe’s consumers and businesses. In
Intrum’s latest European Payment Report
, six in ten of the 10,000 companies survyed say they expect higher inflation (59%) and rising interest rates (57%) to hit their revenues this year. A similar number (57%) say they are concerned about the financial difficulties that their customers are grappling with.
The economic squeeze is undoubtedly making it more difficult for both consumers and businesses to pay their bills. This means many are paying late or defaulting. Six in ten businesses (59%) say they are more concerned than ever about their customers’ ability to pay.
Customers struggling with payment
Rosrio C., Customer Director at Prosegur Alarms, a supplier of security services and technology solutions, says the impact of inflation started becoming visible in September last year. “Our customers in Portugal began telling us that they were finding it difficult to pay,” she recalls. “Others didn’t even tell us that they were struggling. They just didn’t pay up.”
Poor payment is hard to handle in good times, but in times of economic hardship, businesses have to walk a fine line between ensuring their own survival and supporting their customers through the difficulties. Two thirds (67%) of businesses have concerns about their company’s immediate cash flow and almost four in ten (38%) expect to take on more debt this year to cope.
“We want to collect, but we want to keep the customer,” says Rosrio. “Right now, maybe they can’t pay, but tomorrow they could be a valuable customer once again.”
This sensitivity that is key to successful collections in the long term, agrees Intrum CEO Andrs Rubio. Efficient collections processes are important, but businesses need to be flexible and understanding about their customers’ situations. On average, businesses are spending 74 days a year chasing payment – costing the economy 275bn a year. Raising efficiency can make a huge different to the bottom line.
Source: EPR 2023, Question 19
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Intrum AB published this content on 29 June 2023 and is solely responsible for the information contained therein. Distributed by
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, unedited and unaltered, on 29 June 2023 06:48:08 UTC.
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