More than 400 UK businesses have been officially recognised by the government for paying their suppliers promptly and fairly, as part of the Fair Payment Code, a scheme run by the Office of the Small Business Commissioner.
The code, launched in December 2024, is part of a national drive to combat Britain’s late-payment culture, which costs the economy £11 billion each year and leads to the closure of an estimated 14,000 small firms annually — equivalent to 38 businesses every day.
The milestone marks a growing movement among large and mid-sized firms to improve cash flow across supply chains, particularly at a time when small businesses continue to face high borrowing costs and fragile margins.
The Fair Payment Code Awards recognise organisations that demonstrate clear, transparent, and reliable payment practices. Awardees agree to abide by three central principles: to be Clear, Fair and Collaborative with their suppliers.
To qualify, firms must provide detailed evidence of their payment behaviour, verified through a rigorous assessment process. There are three award tiers, based on invoice settlement performance:
• Gold Award – for businesses paying at least 95% of all invoices within 30 days.
• Silver Award – for those paying at least 95% within 60 days, and 95% of invoices to small businesses within 30 days.
• Bronze Award – for firms paying at least 95% of all invoices within 60 days.
Each award is valid for two years, after which companies must reapply and undergo reassessment.
Applications for the next round of awards are open, with businesses encouraged to apply between September and December to secure a full two-year recognition period.
Emma Jones (pictured), the UK Small Business Commissioner, said the milestone demonstrated the growing appetite for responsible business conduct and the wider benefits of good payment culture.
“It is fantastic to celebrate this milestone for the Fair Payment Code with businesses across the UK,” Jones said.
“Awardees are leaders in fair and quick payments, getting money moving through the economy and encouraging growth in supply chains. But this is just the start — I want to see more businesses applying to the Code so we can continue to build a positive payment culture where paying on time is simply seen as the right thing to do.”
Jones added that timely payments were particularly crucial in a challenging economic environment, where small and medium-sized enterprises (SMEs) often act as the backbone of supply chains but lack the liquidity to absorb delays.
Among the businesses recognised under the code are major financial institutions, including NatWest Group, which holds Gold Award status.
Ken McHugo, Head of Supply Chain at NatWest Group, said the accolade reflected the bank’s responsibility to model good practice for its business clients.
“NatWest Group is the biggest backer of businesses in the UK, with more than 1.5 million customers — from start-ups and SMEs to multinational companies,” McHugo said.
“We know first-hand from our business banking customers how important prompt payment is to cash flow, success and growth. By being a Gold Awardee on the Fair Payment Code, we’ve shown our commitment to supporting suppliers through efficient payment processes.”
The UK’s late-payment issue has long been a source of frustration for smaller firms. According to recent research by the Federation of Small Businesses (FSB), one in four small businesses are paid late by larger clients, while 37% cite late payments as their biggest financial challenge.
The Fair Payment Code, combined with the Prompt Payment and Cash Flow Review, forms part of the government’s broader strategy to create a “fairer, faster payment culture”, ensuring that businesses are rewarded for their work without excessive delays.
As more firms commit to the Code, officials hope to build a benchmark for best practice that encourages accountability across every sector — from construction and retail to finance and technology.
“Getting money flowing quickly through the economy is vital,” Jones said. “When businesses are paid on time, they can invest, hire and grow — and that benefits everyone.”
Jamie Young
Jamie is Senior Reporter at Business Matters, bringing over a decade of experience in UK SME business reporting.
Jamie holds a degree in Business Administration and regularly participates in industry conferences and workshops.
When not reporting on the latest business developments, Jamie is passionate about mentoring up-and-coming journalists and entrepreneurs to inspire the next generation of business leaders.
