ANZ pledges to follow new payment code affecting small businesses
ANZ is supporting a new payment code compelling the major bank, along with all businesses who opt in, to pay suppliers on time and within 30 days of receiving a correct invoice.
The news was announced after the Business Council of Australia unveiled its latest initiative, dubbed the Australian Supplier Payment Code yesterday.
Business Council Chief Executive, Jennifer Westacott said that the code was created in response to an overwhelming number of businesses waiting too long for payments, with some reporting delays of up to 120 days.
“We know paying business suppliers promptly and on time is critical to supporting healthy cash flows and working capital, and ultimately supports a business’s viability and ability to expand,” she said.
For ANZ it made sense to back the code, as the big bank’s existing business practices already involve paying suppliers within a 30 day time period.
“Many small businesses bank with us and we know they are more dependent on cash flow than larger organisations, so we are continuing to improve our payments processes to help them and other suppliers succeed,” explained ANZ Group Executive Australia, Fred Ohlsson.
After signing the code, ANZ said that it will reminding staff to pay invoices on time and give suppliers more room to raise concerns with the big bank if required.
What is the new Australian Supplier Payment Code?
A code that every Aussie business and government organisation has the opportunity to sign up to, pledging that they’ll pay eligible* small businesses and suppliers on time and within 30 days of receiving a correct invoice.
*The definition of an eligible business is determined by those who sign up to the code, where they can choose from a set of criteria such as the size of the business and its annual turnover.
How will it be monitored?
Signatories will have 18 months to comply and an independent third party will review their payment processes 12 months after the signing date.
How to chase up an overdue payment:
- Follow up with a friendly email reminder, as it’s a good idea to record all correspondence between you and the client in writing rather than verbally (just in case the situation escalates and you require proof).
- Offer to set up a payment schedule, giving your client the ability to transfer funds into your business bank account over time (if it suits you).
- Seek professional advice from a debt collecting agency or government service in your state.