The increase in credit costs continues to negatively affect the economy of companies. especially small and medium sized onesYou will face more problems to deal with non-payment periods. And the cost of your debt has doubled in one year. In total, it already reaches 2,400 million euros, of which 1,291 million are ordinary debt and 1,075 non-performing loans. This is the highest figure since September 2009.
However, the average payment period in business transactions between companies continued to decline, albeit at a slower pace compared to previous annual periods. This period, which was 82.1 in the previous quarter, realized as 81.3 days between April and June. Thus, this was the lowest average pay period recorded since 2017, but still well beyond the legal maximum of 60 days. This is reflected in the results of the most recent CEPYME Guilt Observatory.
Companies are trying to reduce these terms to mitigate inflation because shortening them prevents the real value of pending collections from declining caused by inflation and is a way to avoid the financial cost increase caused by the increase in business debt ratios. However, the rate of invoices paid on time in the second period remained at 29.5%. Seven out of ten bills are still paid late.
Total commercial debt of the SME group exceeded 180.000 million eurosNearly 70,000 of them corresponded to medium-sized ones, while the debt of small and micro companies increased by 5.5% to 110,000 million Euros, with an increase of 12% compared to the previous year. Financial efforts tripled for them to 1,300 million euros. This is a direct result of the increase in interest rates: the rate of new loans up to 250,000 euros increased from 1.8% in the second quarter of 2022 to 4.6% in the same period of this year.
Regarding the overdue portion of the commercial debt; financial effort increased in a more controlled way because payment terms have been shortened for both small and medium-sized companies, although not for micro-enterprises. The cost of default for SMEs as a whole rose to almost 1 billion 100 million euros in the second quarter; this means an increase of 40.8% compared to the previous year.
Historical record in the industry
Although the average payment period has shortened in the four major sectors operating in the second quarter, it continues to exceed the legally determined 60 days in all. However, the sector figures, which decreased by 77.3 days, draw attention. Lowest historical record for this industry. This is primarily due to the behavior of the electricity, water and gas sub-sectors, which masks the increase over the period in other branches such as machinery and electrical equipment (85.7 days), building materials (93.5 days), or paper and graphics. art (83.1 days).
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The agri-food and services sectors recorded similar average payment periods of 73.9 and 73.5 days, respectively. In the case of ServicesThis level was reached for the third quarter in a row. the sharpest decreasewith declines of more than 10 days, supported by retail trade, vehicle sales and professional activity. The retailer’s average sales time fell to 65.3 days, and vehicle sales to 62 days, the lowest level in history.
On the contrary, subsectors Food distribution and other services increased their average duration is 72.4 days (+5.3 days) and 95.3 days (+9 days), respectively. In the construction sector, the average was 97.3 days; There was a 1.5-day decrease between the years and a downward trend for nine consecutive quarters.