Payment Culture in the UK Banking Sector
In recent years, banks have made significant improvements in their payment processing times for suppliers. In recent years, the UK government has placed pressure on banks to ensure prompt payment of suppliers to promote fair business practices.
Many UK banks have implemented automated payment systems to streamline the payment process and reduce the likelihood of payment delays. This has resulted in faster payment processing times and increased accuracy in payment transactions.
According to a survey conducted by the Federation of Small Businesses (FSB) in 2022, the average payment time for UK banks to their suppliers has decreased to 15 days. This is a significant improvement from previous years, where payment times could exceed 30 days.
Looking at the slowest and fastest paying banks on our list, we can see that even the slower payers rarely take longer than 35 days on average to pay, with Credit Suisse being the exception, already one of the slower payers last year, they have extended their average payment times to 51 days.
The main callout in the banking sector is Natwest Group, who have several subsidiaries. The average payment time to suppliers for every subsidiary and the parent company are all around 6 days. Prompt and fair payment to suppliers and maintaining a strong supply chain is an important priority for Natwest Group, and with the sponsorship of the Chief Executive, Alison Rose, they have set the bar of what good looks like in payment practice for all major UK companies.
Overall, the efforts of UK banks to improve their payment processing times for suppliers have yielded positive results. With faster payment processing times, suppliers can have greater cash flow and more financial stability, which ultimately benefits the wider economy.