European Payment Report 2025

UK executives are ambitious for growth in 2025, with six in ten naming it a top priority for their business. However, optimism has been tempered by new global economic uncertainties and many report frustration over the challenge of late payment by customers, which is hindering investment in growth initiatives.

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Executive summary

Despite some positivity, macroeconomic pressure has taken its toll on UK businesses and 48 per cent say revenues are not recovering as quickly as they would expect – even before the latest economic challenges hit. More than a quarter of SMEs say they face failure if the situation doesn’t improve.

As a result, firms are unwilling to be as flexible on payments as they have been in the past. Almost half (47 per cent) say they are now introducing stricter payment terms as inflation and interest rates have moderated. The number who say they will not negotiate longer payment terms has also risen, to 26 per cent from 23 per cent in 2024.

Resilient ambitions for growth but uncertainty returns

In only a short period of time, uncertainty has rocketed, with radical changes to US trade policy destabilising the global economic environment. Only around a third of UK businesses (34 per cent) currently have no major concerns about cash flow in the immediate future, lower than the European average of 38 per cent. More than a fifth of UK firms say there is a risk they could go out of business.

Executives are confronting their late payment frustrations

More than one in three UK businesses (36 per cent) say payment delays remain as bad today as they were during the extreme economic disruption of the pandemic, despite the fact that they are not finding it as difficult to pay their own suppliers. Consequently, businesses are taking an increasingly strong line on late payments, tightening up on terms and less willing to negotiate delays.

AI is a growing force in payments management

UK businesses have stepped up their use of AI. Close to nine in ten (88 per cent) are open to using or are already using AI technology in their payments management. Enhanced efficiency is seen as the number one benefit, followed by a reduction in late payments, as well as improved analysis, better customer engagement, lower costs and greater accuracy.

EPR 2025

UK Report

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Collections and Customer Service – a Whitepaper

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Guidelines

European Payment Report 2024

Early signs of growth in 2024 led to hopes that the UK economy was turning a corner after a sluggish 2023. With a general election called for July 4 and the Conservative Party trailing in the polls, change is on the cards, so businesses are preparing for a new political landscape in 2025.

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