Why Payment Delays Are Becoming A Bigger Risk For Finance Teams

Payment Delays are Reshaping how Finance Teams Operate

In the US, 55% of B2B invoices are overdue, with similar levels recorded across Western Europe. Around 9% of credit-based B2B sales end up as bad debt, meaning a portion of that revenue is never recovered.

The same pattern holds in the UK. At any given time, an estimated £26 billion in late payments is owed to small businesses. More than 28% of firms are affected each year, and late payments contribute to around 14,000 business closures annually, costing close to £11 billion. 

These figures have been consistent for years, and they point to delays being embedded in how businesses buy, sell, and settle payments, rather than the result of isolated operational issues. 

For finance teams, that creates a gap that has to be managed continuously: revenue is recorded on one timeline, cash arrives on another.

Longer Payment Cycles are Extending Liquidity Pressure

The effect of delayed payments is reflected in working capital metrics. 

Days Sales Outstanding (DSO) has increased by 6.6% over five years, which has pushed net working capital days higher and made liquidity harder to manage. Payment terms have extended alongside this. Allianz Trade reports that global payment terms averaged 62 days in 2024, with Europe close behind at 58.

Cash conversion cycles show the same trend. Analysis of more than 2,700 US public companies shows the average cycle increased from 83 days in 2020 to 90 days in 2023, with only a slight improvement to 89 days in 2024.

The impact is cumulative. When more capital sits in receivables, there is less available for reinvestment, and more reliance on external funding to maintain momentum. 

Some businesses try to manage this by extending their own supplier payment terms. While that can ease short-term pressure, it tends to push the delay further along the supply chain and lengthen the overall cash conversion cycle rather than reduce it.

Limited Visibility is Widening the Gap

As payment cycles get longer, it becomes harder to keep a clear, up-to-date view of cash. 

Only 17% of treasurers report having near real-time visibility into cash positions. A big part of that comes down to how financial data is set up, with many CFOs pointing to poor system integration and a lack of tools to bring data together as the main blockers. 

Even when the data exists, confidence in it isn’t high. Blackline found that 98% of finance leaders don’t fully trust their cash flow visibility, and over a third have concerns about the accuracy of their financial data. In most cases, that comes back to fragmented systems and processes that rely on manual work or spreadsheets. 

The result is that finance teams are often working with a lagged view of what’s happening. In the same survey by Blackline, nearly half of CFOs say they’re making decisions based on information they know may already be out of date, and a similar number say limited visibility makes it harder to respond to changes in the market. 

However, there’s a clear push to improve this, and CFOs are prioritising reporting, analytics, and transformation, but progress is still uneven. Only 22% of finance functions have a fully developed 3-5 year vision of their finance function. 46% see technology as the biggest barrier.

Timing Gaps Increase Exposure to Fraud and Leakage

When there’s a delay between activity, validation, and reporting, issues take longer to surface. 

The Association of Certified Fraud Examiners’ 2024 Report to the Nations found that the median duration of fraud schemes is 12 months before detection. In 32% of cases, weak internal controls were a factor, with a further 19% involving overrides of existing controls. 

Those numbers reflect how long problems can sit inside a business before they are identified. Where validation cycles are slow and reporting is fragmented, it becomes harder to connect what’s happening in real time time with what’s being reviewed. 

That delay shows up in familiar ways: discrepancies take longer to reconcile, duplicate, or incorrect payments are harder to spot, and disputes remain open for longer than they should. 

Over time, that increases both the likelihood and the cost of issues. The longer something goes unnoticed, the more difficult it is to contain, and the more it impacts financial control.

Liquidity Timing is Now a Governance Issue

Liquidity timing is starting to be treated as a part of broader financial risk management, rather than just a working capital concern. 

EY and the Institute of International Finance reports that 66% of Chief Risk Officers now identify liquidity risk as the top financial risk, ahead of both retail and wholesale credit risk. Deloitte’s Global Corporate Treasury Survey shows that almost all treasury teams now view liquidity risk management as a core part of their role. 

That change is showing up in what finance teams are being asked to deliver. Reporting needs to be more accurate and more frequent, internal controls need to be tighter, and decisions are expected to be made faster, often across multiple markets and systems. 

Where payment timing is unpredictable, those requirements become harder to meet. Cash positions are less certain, reporting relies more heavily on assumptions, and it takes longer to build a clear picture of risk across the business.

Ultimately, liquidity is no longer just something to manage in the background. It plays a much more direct role in how finance teams maintain control, support decision-making, and give confidence to the wider business.

Aligning Liquidity, Visibility, and Control

Payment delays, limited visibility, and risk exposure don’t sit separately. They build on each other.

As payment cycles stretch, financial data becomes less immediate. That makes it harder to maintain a clear view of cash and ultimately more difficult for businesses to identify issues quickly and act with confidence.

What changes this is bringing access to cash closer to when revenue is actually earned. 

Transactional-Based Funding does this by turning earned revenue into instant capital. By connecting directly to the platforms where revenue is generated, it uses transaction-level data to make capital available as revenue is earned, rather than waiting for invoices to be raised and processed. 

This changes how finance teams experience the timing gap. Access to capital moves closer to the point where value is created, and the same data that supports funding also improves visibility into revenue and expected cash flow. 

It also makes control easier to maintain. When transactions, funding, and repayment are linked, discrepancies are easier to identify and resolve, and reconciliation becomes less dependent on looking backwards to understand what has already happened.

Where Liquidity Management is Heading

Payment delays aren’t new, but the way they affect businesses has changed.

As payment cycles have stretched, they’ve started to influence more than just cash flow. They shape how clearly finance teams can see what’s happening, how quickly they can respond, and how confidently they can make decisions.

That becomes more noticeable as the pace of the digital economy increases. Revenue is generated continuously and tracked in detail, but access to that revenue still follows a slower, less connected process.

Bringing liquidity closer to the point where revenue is generated changes that dynamic. It improves visibility, shortens the distance between activity and cash, and makes it easier to maintain control as businesses scale. 

If payment timing is influencing how your business operates, speak with our team today. They’ll show you how Revving’s approach to funding helps you keep control.