iscoverNew research by bank payment company GoCardless said that late payments were creating cashflow issues for small and medium enterprises, resulting in stress and productivity drains.
Late payments a productivity drain for Aussie companies, survey finds
12 September 2025
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7 minute read
In its 2025 ‘Pursuing Payments’ report, GoCardless found that 17 per cent of small and medium businesses (SMBs) in Australia were losing over $2,500 per month to late payments, up from 11 per cent in 2024.
GoCardless ANZ general manager Ian Boyd warned that late payments were having impacts on investment and productivity in Australia’s SMB sector. Survey responses indicated that 24 per cent of SMBs would invest in expanding their operations and 17 per cent would directly hire more people if their customers paid on time.
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"Against the backdrop of the Productivity Commission's interim reports and the recent Federal government economic roundtable, productivity continues to be a key concern,” Boyd said.
“Our data indicates that late payments are increasingly creating an obstacle to improving that key economic metric."
Businesses that modernised their payment infrastructure could minimise the stress and financial issues sparked by late payments, Boyd said.
"Businesses can't solve the late payment crisis by themselves, but there are things every business can do to better insulate themselves from the impact,” he said.
“Every business should be routinely reviewing its payments stack and embracing solutions like eInvoicing, automated follow-ups, and new payment methods like PayTo."
For example, GoCardless noted that the adoption of New Payments Platform (NPP) technology could make transactions simpler and more transparent, boosting productivity.
As described by the Reserve Bank, the NPP is an “open access infrastructure for fast payments in Australia.”
“The NPP was developed via industry collaboration to enable households, businesses and government agencies to make simply addressed payments, with near real-time funds availability to the recipient, on a 24/7 basis.”
GoCardless’ research indicated that late payments were having material impacts on businesses’ operational choices.
Over a quarter (26 per cent) considered increasing their prices to offset the cost of payment delays, 23 per cent considered paying their own suppliers late and 34 per cent considered refusing future work from chronic late payers.
The survey also found that 1 in 5 companies were devoting 6-12 working days a year chasing overdue invoices, with 58 per cent of Australian SMBs spending up to 3 hours per week on payment collection.
“Even as we see economic conditions improving in Australia, the impact of late payments is only worsening for businesses across both Australia and New Zealand,” Boyd warned.
“This is not only having a huge toll on business growth, but also on the mental health of individuals within businesses. It’s clear many SMB decision-makers aren’t aware of how to source and integrate solutions that can help them solve the pursuing payments puzzle.”
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