Adfin | The human impact of late payments, and the solution in technology

In conversation with Mia Rees, Head of Communications and Engagement at the Office of the Small Business Commissioner.

Mia Rees' grandfather built his own business selling children's clothes, and Mia grew up watching from the front row: what it takes to build something from nothing, what it takes to scale it, and everything that could go wrong along the way. Not a bad introduction into the world of entrepreneurship given she now serves as Head of Communications and Engagement for the Office of the Small Business Commissioner.

The Small Business Commissioner is a government arm's-length body with one job: making sure businesses get paid on time. If you're a small business (under 50 employees) owed money by a large one (over 50) and you've chased and chased and got nowhere, the Commissioner's casework service will step in and chase on your behalf. Since the role was created, it's recovered over £10 million for small businesses, £1.5 million of that in the last financial year alone.

The Commissioner also runs the Fair Payment Code, the gold-silver-bronze standard for businesses that pay well and can prove it. 650+ businesses are now part of the code, with that number expected to scale rapidly in the next 6 months.

We caught up with Mia on our recent Tea Party Tour, at our stop in Cheltenham, to talk all things late payments, the upcoming changes to the law, and the role technology has to play in supporting shifts.

An invoice is never just a number

An unpaid invoice looks like the most impersonal thing in business. A line on a spreadsheet, a date that's come and gone, a slightly awkward email chase. But behind every one of those lines is a business that can't make payroll, a founder who's gone unpaid themselves so their team doesn't have to, people who can't cover rent or a mortgage because money owed to them hasn't turned up.

Mia is clear about why nobody talks about this. Admitting you've been paid late feels like admitting you can't manage your own finances, so businesses quietly absorb it instead. But it's common, not shameful, and the silence around it is part of the problem. At its most serious, this isn't just a cash flow story. The Small Business Commissioner has heard from businesses where the strain of not being paid has compounded with other pressures to devastating effect.

The economics back this up. Late payment closes roughly 38 businesses a day in the UK. On top of that, businesses lose an estimated 86 hours a year each chasing money they're owed, which adds up to over 133 million hours across the economy annually. That's time not spent serving customers, hiring, or growing, spent instead on the least productive task in business: asking, again, for money that was already due.

The law is finally catching up

There's legislation moving through Parliament right now that would change the maths on all of this. It would cap standard payment terms at 60 days by default, with only limited exemptions. It would make late payment interest mandatory too, at 8% above the Bank of England base rate, so a 30-day contract paid in 60 gets 30 days of interest attached automatically, not as a favour.

The Commissioner would also gain real teeth: powers to investigate companies off the back of anonymous tip-offs, and to issue fines to persistent offenders. And in construction specifically, the bill would ban retention payments outright, a practice that's quietly starved small contractors of cash for years.

Mia's framing of it stuck with us: you'd never accept a business that didn't pay its staff, so why has it become acceptable not to pay an invoice on time? This legislation is the first serious attempt to close that gap, and to make fair payment the default rather than the exception.

Where technology comes in

None of this fixes itself without better tools. Mia points to digital adoption, and e-invoicing in particular, as one of the biggest unlocks available to small businesses right now. Moving off a spreadsheet and onto a platform that can chase, track, and flag late payments automatically hands back the hours a business would otherwise spend doing it by hand, and takes the awkwardness out of the chase itself.

That's the exact gap we built Adfin to close. Technology won't rewrite payment culture on its own, but paired with a bill that finally has teeth, it means small businesses spend less time chasing and more time building the thing they set out to build in the first place.

To learn more about the work of the Small Business Commissioner, visit their website: https://www.smallbusinesscommissioner.gov.uk/

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