Suppliers 'Left Holding the Bag' Due to Sluggish Trade, Un-Digitized Payments
Small suppliers often find themselves waiting weeks, sometimes even months, to access the payments they’re due for goods or services rendered. A conservative estimate from PYMNTS shows that SMBs are waiting on around $1.3 trillion in collective, unpaid invoices at any given moment.
By no means is it a new problem, but it’s one that’s becoming more pressing due to the COVID-19 pandemic leaving millions of SMBs short of cash. The trade credit gap is believed to be growing by the day due to supply chain snags causing delays in orders being fulfilled.
“With COVID and the things that have happened around the supply chain, we’ve seen a broadening of that trade finance gap,” said MonetaGo Chief Executive Jesse Chenard in an interview with PYMNTS. “People are taking longer to get their parts and their goods to places, and people won’t pay until they get their stuff, so it’s the suppliers who are left holding the bag.”