UK Average Supplier Payment Time: Which Sectors the 60-Day Cap Will Hit Hardest
Average supplier payment time measures how long a business takes to pay its own suppliers, on average. It's one of the simplest numbers in finance, and one of the easiest to overlook, right up until a law forces it to move.
That's about to happen. The Commercial Payments Bill [HL], which will cap invoice payment terms at 60 days, is now working its way through Parliament, having completed report stage in the House of Lords on 15 September 2026. Businesses already paying well within that mark will find the change manageable. Where real payment times sit well above it, the cap becomes a cash flow event.
Where UK large businesses actually stand today
The Department for Business and Trade's 2025 payment practices statistics, published July 2026, give the clearest official picture available. These figures measure time to pay from reported payment-practice data. Days Payable Outstanding, the accounting metric, is calculated separately from accounts payable and purchases.
UK large businesses paid suppliers in 32 days on average in 2025, down from 35 days in 2018, though the figure has held flat since 2023.
15% of invoices were still paid late in 2025, down from 25% in 2018.
The sector spread is wide. Manufacturing averages 45 days to pay suppliers and has the highest late-payment rate of any sector, at 21%. Financial and insurance activities average just 21 days, the fastest of any sector.
Regional spread tells a similar story: East Midlands and West Midlands businesses average 38 days, while London businesses average 27 days.
Why the national average hides the real risk
A 32-day national average sitting comfortably under a 60-day cap looks reassuring, and it hides a wide spread. That average blends sectors paying in 21 days with sectors paying in 45, and the average itself is a further blend again, smoothing over individual suppliers being paid in 30 days, 90 days, or longer within the same business.
It is the long tail behind that average, the invoices currently sitting well above 60 days, that the cap will force down hardest. For a finance team whose own payment times already sit close to or above 60 days, the cap means a genuine change to how much of its own cash is tied up in unpaid supplier bills at any given time.
The EU drew the same line years ago
The EU has run a similar cap for over a decade. The Late Payment Directive (2011/7/EU) sets a default 60-day limit on B2B payment terms across member states, with statutory interest at the European Central Bank's reference rate plus 8%, a structure the UK's own proposal closely mirrors with the Bank of England base rate plus 8%. The 60-day figure is the same line a large trading bloc has been enforcing for years.
What compression actually means for a finance team
Bringing average supplier payment time down takes work. It means going through supplier contracts individually and renegotiating any terms that currently exceed 60 days, which takes time, administrative effort, and sometimes difficult supplier conversations.
It also means cash leaves the business sooner than it has been used to. Whatever that extended payment window was quietly funding, working capital for stock, payroll, or growth spend, now needs to come from somewhere else. This pressure lands hardest exactly where the GOV.UK data shows payment times already running high: Manufacturing at 45 days, Wholesale and retail trade at 37 days, and Water supply and waste management at 37 days. In these sectors, more invoices are likely to sit beyond 60 days today, so more supplier contracts will need renegotiating.
Two separate clocks
It's worth being precise here. The obvious response, paying suppliers faster, sounds like it works against a business's own cash position, but using card payments could change that picture.
The 60-day cap governs the relationship between a business and its supplier. It says nothing about the relationship between that business and how it funds the payment itself. When a supplier is paid through a purchasing card or virtual card, the supplier is settled quickly, comfortably inside the 60-day limit. At that point, the business's obligation moves to its card issuer and runs on the card's own billing cycle.
Compliance happens on the supplier side and working capital flexibility happens on the card side. Decoupling those two clocks is the reason a business can bring its average payment time down without its own cash position getting worse, and in some cases while it improves.
Corpay's own research into 300 UK CFOs, set out in the Card-First Approach to Spend Modernisation whitepaper, found that 81% say 30 to 44 days of additional working capital flexibility would be very valuable or essential. That's close to the gap a compressed payment time creates. AP automation closes the visibility side of the same problem, giving finance teams a live, sector-accurate view of their own payment performance rather than relying on a lagging annual figure.
What to do now
Find your real number. The 60-day cap applies to every business, whatever the sector, so measure your own payment times against it, supplier by supplier. Sector figures are useful context only.
Identify the long tail. Pull the supplier contracts currently sitting above 60 days and flag them for renegotiation now, ahead of the cap becoming law.
Model the cash impact alongside the compliance impact. Compressing payment time by 10 or 15 days has a real, calculable effect on working capital that finance leaders should be forecasting now.
Separate the two clocks deliberately. Decide which categories of supplier spend, particularly tail spend like software, subscriptions and ad-hoc purchases, are best suited to card-led settlement, and route them accordingly.
None of this waits for Royal Assent. The businesses with the clearest read on their own real payment time, sector by sector and supplier by supplier, will be the ones that absorb the 60-day cap without a cash flow shock.
Frequently Asked Questions
What is average supplier payment time?
Average supplier payment time is the average number of days a business takes to pay its suppliers, based on reported payment-practice data. It's related to the accounting metric Days Payable Outstanding, which is calculated separately from accounts payable and purchases.
What is the average UK supplier payment time for large businesses?
Large UK businesses paid suppliers in 32 days on average in 2025, according to the Department for Business and Trade. This varies significantly by sector, from 21 days in financial and insurance activities to 45 days in manufacturing.
How will the 60-day payment cap affect UK businesses' payment times?
Businesses with an average payment time already close to or above 60 days, particularly in manufacturing, wholesale and retail, and water and waste sectors, will need to renegotiate supplier contracts and compress their payment times once the cap becomes law.
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