Tuesday 27th August, 2019
The Small Business Commissioner has published a report on BUPA Insurance Services Ltd over their poor payment practices of late payment interest to a small supplier.
Blacklight Advisory Services Ltd submitted a complaint to the Commissioner after Bupa failed to pay the frim an invoice for £29,403.76 based on 45-day end of month payment terms.
Bupa Insurance Services Ltd responded positively to the Commissioner’s investigation, immediately approving and releasing the overdue payment which was made outside of the contracted terms.
Following the investigation, Bupa Insurance Services acknowledged the late payment by offering a claim for late payment interest but this was short of the minimum requirement.
Paul Uppal said, “I do not consider a contractually agreed variation of late payment charges at 2% above the Bank of England Base rate from a global company sufficient."
According to the report, Bupa Insurance Services Ltd stated that they offer preferential 30-day payment terms to small businesses however, this policy was implemented after commencement of the complainant’s contract. Blacklight Advisory Services Ltd were held to their original agreement after requesting a variation in payment terms to 30 days.
The commissioner said, "I am witnessing variations from the statutory defined value of late payment more frequently in contractual agreements. It seems that small businesses are being pressured into accepting these terms if they wish to supply large businesses as part of standard framework agreements.
He added, "A substantial remedy for late payment should be substantial. It should adequately compensate the small business for impacted cashflow, and any additional resources required to chase outstanding invoices.”