# Time Finance targets working capital gap as late-payment rules tighten

- Link: https://www.directorstalkinterviews.com/time-finance-targets-working-capital-gap-as-late-payment-rules-tighten/4121261159
- Published: 2026-08-25T12:50:00+01:00
- Author: Amilia Stone

Time Finance is highlighting the continuing need for working capital support as 
the government moves to strengthen protections for small businesses facing late 
payments.

The proposed Small Business Protections Bill would introduce tougher rules around
payment practices, including a 60-day limit on payment terms for large companies,
mandatory statutory interest on late payments and stronger enforcement powers for
the Small Business Commissioner.

The measures are designed to tackle a problem that has affected UK SMEs for decades.
Previous attempts to improve payment behaviour have included late-payment legislation,
the Prompt Payment Code and mandatory reporting requirements. Despite these measures,
many smaller businesses still face delays between completing work and receiving 
cash.

That gap can put pressure on working capital. Businesses may need to cover wages,
suppliers, rent and other costs before customers settle their invoices. Even profitable
companies can therefore face cash flow pressure when payments arrive later than 
expected.

The new legislation could improve the position of smaller suppliers, but stronger
legal rights may not be enough on their own.

Many SMEs rely heavily on larger customers and may be reluctant to challenge late
payments if they believe doing so could put future business at risk. A company may
have the right to charge interest or take action over an overdue invoice, but the
commercial relationship can make that decision more difficult in practice. This 
means the success of the proposed reforms will depend partly on whether payment 
behaviour changes across larger organisations, not simply on whether new rules are
introduced.

That leaves a continuing role for funding providers that can help SMEs manage the
timing gap between issuing an invoice and receiving payment.

Time Finance provides Invoice Finance, allowing businesses to access cash linked
to outstanding invoices before customers have paid. The product is designed to reduce
the pressure created by long payment cycles and give businesses greater control 
over cash flow.

_**[Time Finance plc](https://www.directorstalkinterviews.com/company/time.l)** (
[LON:TIME](https://www.directorstalkinterviews.com/company/time.l)) is an AIM-listed
business specialising in the provision or arrangement of funding solutions to UK
businesses seeking to access the finance they need to realise their growth plans.
Time Finance can fund businesses or arrange funding with their trusted partners 
through Asset Finance, Invoice Finance, Business Loans, Vehicle Finance or Asset
Based Lending._

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