New Zealand invoice payment times have fallen to their lowest point in over a decade, with businesses taking 34.9 days on average to pay their invoices during Q3 2016.
Dun & Bradstreet’s Trade Payments Analysis says that the latest payment figure marks a slight improvement on the previous quarter’s 35.5-day average, and shows New Zealand companies pay their bills almost 10 days faster than their Australian counterparts. The result continues a recent trend of record-low payment times, which have remained below the 40-day mark since Q4 2014.
Stephen Koukoulas, economics advisor to Dun & Bradstreet says that firms in New Zealand continue to pay their bills quickly, with the number of days for bill payments at historical lows. At an average of 34.9 days, trade payment times have been steady for the past year, at a level which remains 10 days or more quicker than average payment times during the global financial crisis.
“New Zealand firms pay their invoices more quickly than Australian firms pay their invoices. It is not clear why this gap exists given that over the medium term, the economic performance and level of interest rates in both countries has been similar. One issue that may account for the difference is that agriculture, which has the quickest invoice payment times, is a larger part of the New Zealand economy than in Australia. This may skew the trade payment numbers lower in New Zealand.
“The trade payments data continue to indicate that firms are generally ‘cashed-up’, and with low interest rates continuing, there is little incentive to delay paying creditors,” he said.