FAQs
 
 
Prompt Payment Code Q&A

Where can I find information about the Duty to Report requirements?

The Government has provided guidance to reporting on Wednesday 11th October 2017, and can be read here.

What is an 'exceptional circumstance'?

Please click here to read a letter from the previous Minister for Small Business, Consumers and Corporate Responsibility and the Chief Executive of the Chartered Institute of Credit Management which clarifies the issue of 'exceptional circumstances'. If you require further information, please contact us.

How have you previously strengthened the Code?

The Code itself is an industry-led initiative. We, along with the Chartered Institute of Credit Management have brought together an Advisory Board made up of signatories to discuss how the Code can be strengthened.
We are strengthening the Code by:
  • introducing a 60 day maximum payment term, and enshrining a 30 day payment term as a norm for all signatories as standard practice;
  • creating a Code Compliance board to enforce the Code, including its maximum payment term;
  • requiring small and medium sized signatories to report annually on their payment performance, on a comply of explain basis, and for large signatories to report on their payment practice and performance in line with the new statutory reporting requirement;
  • increasing the number of references needed to validate membership; and
  • promoting and strengthening the Prompt Payment Code website.
The Advisory Board have endorsed these changes to the Code.
The recently announced Call for Evidence will gather views on further ways to strengthen the Code

What is the relationship between the Code and the Small Business Commissioner?

The Commissioner will work closely with the Chartered Institute for Credit Management to ensure consistency with the Prompt Payment Code. More information about the Commissioners services can be found here - https://www.smallbusinesscommissioner.gov.uk/

How is the Code monitored/enforced?

The Code Compliance Board considers and responds to complaints by Code signatories. The Board can sanction signatories; including if need be expelling them from the Code. The Government's Duty to Report requirement has now come into force, this is actively monitored by CICM who will be able to proactively challenge a signatory on their payment practices and policies if their reports suggest they are not complying with the Code..

Paying over 60 days can be easily explained away. This isn't strong enough.

The 60 day payment term is a positive step in addressing the issue of late payment. The Code takes this one step further and sets a thirty day term for companies to comply with standard practice.

Who will sit on the compliance board?

The Compliance Board will consist of at least five core members. We expect three of the members will be drawn from trade representative bodies, who would judge cases as individuals, rather than representative of their respective organisations. The other two members will be corporate Code signatories which will include a public body. Click here for further information.

How are the decisions of the compliance board announced/made publicly available?

The Code Compliance Board will make enforcement decisions on behalf of the Code. The Board will issue a public statement if a signatory is removed from the Code, and a list of removed signatories will be available on the Code website

What is the difference between the 60 and 30 day payment term principle?

The Code has set 30 days as a target which all signatories should work towards. The upper limit of the Code is that signatories will have to pay 95% of their undisputed invoices within 60 days, or explain that non-payment was due to exceptional circumstances. If the Compliance Boards finds that neither finds that neither of these conditions was met then the signatories were not compliant with the Code. The Advisory Board also considered that 30 day payment terms are best practice, and will advocate this as a standard for all signatories to aspire to.

What are exceptional circumstances?

The Code Compliance Board will have the scope to define exceptional circumstances when a challenge is made on a signatory.

How will signatories need to report?

Large companies are required to report on their payment practices and performance in line with the new statutory reporting requirement. All published reports can be found here - https://www.gov.uk/check-when-businesses-pay-invoices.

How do I provide additional referees?

Please email your referee information to promptpaymentcode@cicm.com or respond to the email that the Prompt Payment Code will send to you over the next few months.

 
 
 

How do we know that others are as good as us?

Every organisation has to go through the same application process and all Approved Signatories are reviewed every 6 months by asking their referees to confirm they are still paying promptly. This will ensure the signatory list has integrity and can be relied upon as a genuine indication of good practice.

How will we know we have been accepted?

Once we have received positive references, you will receive an email confirming your successful application together with the Prompt Payment Code logo. If there is a problem with your references, we will contact you.

Can I challenge the status of a signatory of the Prompt Payment Code?

Yes, suppliers can use the 'Challenge’ section of the website to challenge the status of a signatory. The challenge will be investigated by the CICM and contact made with the signatory who is encouraged to enter a dialogue with the supplier. If it might be helpful, the CICM is happy to speak to both parties and support their efforts. Where appropriate, the matter is referred to the Code Compliance Board which will determine what action might be required by the signatory or whether its status as a signatory should be removed.

Can an organisation based outside of the UK become a signatory?

Yes, if it trades in the UK or with UK suppliers.

Is there a policy document?

No. All the information you require is clearly shown on the website.

What do I do if my industry sector isn't showing on the Apply page?

Please contact the administrators of the Prompt Payment Code who will give advice.
 
 
 
The Chartered Institute of Credit Management (CICM) is the largest professional credit management organisation in Europe. It represents the credit profession across trade, consumer and export credit, as well as in related activities such as collections, credit reporting, credit insurance and insolvency. Visit www.cicm.com for more cashflow and credit management advice.   twitter #promptpayment
#promptpaymentcode
 
© CICM & www.promptpaymentcode.org.uk 2008 - 2015 : all rights reserved : privacy policy