29 July 2010 | Angeline Albert

UK firms paid their bills three days faster between April and June of 2010 than in the same period last year, the Late Payment Index from information services firm Experian shows.

During the second quarter of 2010 businesses settled up an average of 20 days late compared with 23 days late in the same quarter of 2009.

Micro businesses (1 or 2 employees) led the improvements by reducing average late payment from 21 days to 18 days. This was followed closely by the largest companies (501 or more employees), which reduced their average late payment from 40 days to 35 days.

Sector-wise the biggest improvements came from IT, which almost halved its late payment times from 26 days to 14 days. The property sector continues to pay its bills the slowest, averaging 33 days beyond terms, more than 13 days slower than the national average.

The South East of England saw the biggest improvement in payment performance, from 20 to 16 days. Averaging 25 days beyond terms, the North West overtook London to become the slowest paying region.

Joe Myers, head of commercial credit at Experian, said: “Even though they remain among the slowest payers, the largest companies have improved significantly over the last year. This improvement in cash-flow is good news for everyone, especially smaller companies, and better for the economy as a whole.”