UK – Freelance economy could be in trouble due to late payments
Freelancers in the UK are struggling with late invoice payments with 36% of freelancers having to borrow from a payday loan firm to cover a shortfall and 46% stressing about having enough cash to live on, according to research from London-based Finance start-up Ormsby Street.
The research also showed that UK freelancers owed an average of £5,431.03 in late payments. Moreover, 1 in 10 freelancers have faced difficulties paying their mortgage or rent because of late invoice payment with 37% having to turn to family to help cover any shortfalls.
“Every freelancer knows that late invoice payment is one of the biggest frustrations, impacting cash-flow and causing much stress, from paying the mortgage to having enough money to live on,” Martin Campbell, Managing Director, Ormsby Street, said. “For a freelancer to be owed more than £5,000 is clearly unacceptable and threatens the emerging freelance economy in the UK, which brings flexibility and work / life balance to so many.”
While 19% of respondents say most of their invoices are always paid on time, a freelancer’s invoices are paid on average 18 and a half days after their due date. The research showed that 79% of freelancers say that cash-flow is the number one concern for their business.
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