Deferred Payment, Late Payment, Payment Backlog and How They Are Interconnected (the first of two articles about payment delays)

Abstract

The paper discusses the problem of payment delays in commercial B2B transactions and payment backlogs resulting from them. It also aims at identifying linkages among deferred payments, late payments, and payment backlogs taking account of the scalę of these phe- nomena in Poland, as well as in other countries. Besides, it presents the results of studies on payment delays published in three most important International reports of the following companies: Bisnode D&B, Atradius, Intrum Justitia. The analysis confirmed that a payment delay as such is neutral but it may become negative as a result of the stance taken by an entrepreneur-creditor, who experiences a late payment. Payment delay becomes a negative phenomenon only when the creditor does not approve of such a situation. However, it remains neutral to an entrepreneur who accepts payment delays. Thus, a payment delay is a feature rather than a functional defect of the trade credit market.
Since the problem of payment delays and payment backlogs is a pertinent one, it needs to be discussed in specialist literaturę. The paper provides recommendations as to what should be done to reduce the scalę of these negative phenomena.