Budapest, 25th September, 2019 – 78% of the bills are paid on time by Hungarian customers, which is slightly below the Central and Eastern European ratio (80% pays on time). For the seventh time, Hungary participated in a survey conducted by one of Europe's leading receivables management companies. The survey asked about 3,600 decision-makers in 17 countries about the payment habits of corporate and private clients.
There is no significant change in Hungarian payment deadlines: in 2019, Hungarian companies were billed with an average 37-day payment deadline, which has not changed much in the last 5 years, despite the fact that European companies' average payment deadline has decreased from 37 to 33 days.
In 2019, 18% of the bills were paid late, which is one percentage point lower than last year's rate and it is the same as the Eastern European average. Putting the rates into 5 years perspective, there is a clear improvement in the payment habits of Hungarians, as in 2014 only 74% of bills were paid on time and 21% were late.
The proportion of irrecoverable debts is the same as last year, 4% of the invoices issued in Hungary are not paid at all, which is a significant 2 percentage points improvement compared to 2014.
There are similar reasons for non-payment and late payment for individuals and corporate clients. Clients of the corporate sector mentioned late payments by their own partnerts (53%), use of supplier credits (51%) and bankruptcy (48%) as the reasons for late payments and non-payments; while 68% of non-paying individuals referred to temporary financial problems and 53% to total insolvency. This latter rates increased significantly compared to last year (temporary financial problems - 60%, long-term insolvency - 45%). Intentional non-payment was mentioned by the surveyed companies in 29% of corporate clients, while in the case of private clients, 41% encountered the problem. This includes not only intentional fraud but also dissatisfaction or questioning the legality of the invoice.
Tamás Kraszna, head of EOS Hungary's Unsecured Collection Directorate, said: “This year's survey shows that Hungarian clients' willingness to pay is steadily improving, however, the rate of intentional non-payment has increased slightly for both corporate and private clients. Recovery of such debts is less effective with companies' internal claims management methods and capabilities, so involving an external, professional receivable management partner in the debt management process can help greatly in such cases. Every second (51%) Hungarian company surveyed employs an external partner, ”the expert said.
About EOS 2019 'European Payment Practices' Study
In the spring of 2019, EOS Group interviewed 3,400 financial experts in 17 European countries about their payment practices in their country. In Austria, Belgium, Bulgaria, Greece, UK, France, Poland, Romania, Russia, Slovakia, Spain, Croatia, Czech Republic, Switzerland, Germany, Slovenia and Hungary, 200 decision makers in the receivable management sector responded to questions about payment, economic trends and debt management over the past 12 years.
The EOS Group
The EOS Group is one of the leading international providers of customized financial services. Its main focus is on receivables management, and with its 60 subsidiaries, more than 7,500 employees and 20,000 customers, it is one of the largest players in the market. Working in an international network of partner companies, the EOS Group has resources in more than 180 countries, and directly operates subsidiaries in 26 countries. The company's key target sectors are banking, insurance, utilities, telecommunications and IT companies. EOS is part of Otto Group.
For more information please go to: www.eos-solutions.com