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P DEBT
Page 10
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Hauliers fail to carry out proper credit checks
HAULIERS ARE FAILING to carry out thorough credit checks of new customers despite the number of bad debts being chased through court claims rising by 87%.
A debt collection company says it is habitually instructed to recover debts owed to businesses before discovering that credit has been given without consulting available evidence that shows it should have been rejected. Warwickshire-based Prodebt's analysis comes as law firm Lovetts reports there has been an increase in companies chasing bad debts.
The amount of time firms are allowing between invoice and a 'Letter before action' also fell by 10 days during the first quarter of 2009 compared with the same period in 2008.
Lovetts managing director Charles Wilson says: "The results show hauliers appreciate the risks of allowing late payments to become major debt issues."