Coface Survey Shows Decrease in Payment Delays and a Positive Economic Outlook for 2021
According to a recent Germany corporate payment survey by Coface, payment delays have steadily decreased from 2020 to 2021. Among the companies responding to the survey, only 59% are reporting payment delays this year – a 9% decrease from 2020.
Companies are also reporting a drop in the duration of payment delays resulting in an 8-day decline to an average of 27.7 days past due this year. Sectors experiencing the largest declines in the duration of payment delays include pharma-chemicals (-26 days) and the information-communication technology (-25 days) sector.
Companies doing business in the information-communication technology sector now have the shortest wait times to get paid with an average of 17.5 days. Companies in the machinery sector are experiencing the opposite as they currently host the longest average wait times of 35.8 days.
Surveyors point towards financial difficulties as one of the main reasons payment delays occur (46%), followed by lower demands in Germany (20%) and the lack of financing options (20%). However, these responses may be subject to change as COVID-19 public financing support programs remain in effect in Germany.
Despite any changes that may loom in the near future, companies are responding with a "cautiously optimistic" assessment of their 2021 economic outlook. Over 40% of survey takers are siding with this positivity, but 11% still believe their business situation will worsen compared to 2020. As for 2022, the outlook continues to be positive, but seems to be less certain.—Bryan Mason, editorial associate