Payment Delays: The Revolt of Small and Medium-Sized Enterprises

An Old Wound with Devastating Effects

Delayed payments have long been a persistent issue in the French economy, undermining the cash flow of businesses and weakening the smallest among them. By 2025, business failures are on the rise again, with 69,000 bankruptcies expected, marking a 10% increase compared to pre-Covid levels. In a context of more expensive financing, every day of delay counts. According to figures cited by the Senate, these delays increase the risk of failure by 25%, and by even 42% when they exceed 60 days.

The imbalance is glaring: 70% of delays come from large companies, which use their suppliers' cash flow as an adjustment variable, while nearly 30% stem from public administration—state, local authorities, or hospital establishments. According to Olivier Rietmann, president of the Senate's business delegation, « it's time for everyone to take responsibility to avoid further weakening our small and medium-sized enterprises."

This situation extends well beyond industry or services: the construction and real estate sector is among the hardest hit, where slow payments on public or semi-public construction projects heavily impact cash flow balances. Delays have become a factor slowing down productive investment, just when market recovery demands reactivity.

Proportional Sanctions, a Public Factoring Fund

The text submitted to the Senate proposes a reform that is simple in principle but ambitious in its effects. First, fines for late payments will now be proportional to the revenue of the offending companies: a large corporation will no longer pay the same penalty as a small or medium-sized enterprise (SME). Additionally, the creation of a public factoring fund will ensure rapid payment for small businesses affected by delays in public payments. This fund will advance the owed amounts and then seek reimbursement from the defaulting public purchasers.

The bill also calls for a clarification of the legal starting point for payment deadlines and prohibits the waiver of late payment penalties, a practice too common among subcontractors economically dependent on their clients. « It's a virtuous cycle for the economy that doesn’t increase public expenses, » emphasizes the senator, reminding that payment discipline has a direct impact on inter-company trust and thus on growth.

Beyond sanctions, the text aims to restore an environment of economic responsibility. In a high-interest-rate environment, where cash flow is costly, timely payment becomes an act of competitiveness and loyalty. Companies that pay quickly protect their suppliers, secure their supply chains, and enhance their reputation as reliable actors.

A Welcome Boost for Small Businesses

For very small enterprises, the reform would offer a much-needed boost. In industries such as construction, public works, real estate asset management, or property services, just one unpaid invoice can disrupt the entire operation. Payment delays then become as much a macroeconomic issue as a moral one: an economy needs to regain trust to invest.