The Asia Corporate Payment Survey, conducted by Coface between November 2022 and April 2023, provides insights into the evolution of payment behavior and credit management practices of about 2,300 companies across the Asia Pacific region. Respondents are active in nine markets (Australia, China, Hong Kong SAR, India, Japan, Malaysia, Singapore, Taiwan and Thailand) and 13 sectors.The survey revealed that overall, fewer businesses reported overdue payments in 2022. Indeed, the share of companies reporting overdue payments fell to 57% in 2022 – the lowest in 10 years – from 64% in 2021. Nevertheless the duration of payment delays across Asia-Pacific increased markedly, as businesses were more restrictive with credit terms amid aggressive rate increases, tighter financial conditions and higher inflation. The average payment delay lengthened from 54 days in 2021 to 67 days.Sector-wise, seven of the thirteen sectors in the survey registered longer average payment delays. Overdue payments increased the most in retail (+15 days), pharmaceuticals (+10.5 days), and energy (+10 days). The energy and construction sectors posted the longest average payment delay at 77 days. On the other hand, agrifood and textile saw the shortest payment delays with a drop from 60 days in 2021 to 52 days in 2022.According to Coface’s experience, 80% of overdue longer than 6 months (ultra-long payment delays /ULPDs) are never paid. Therefore, cash-flow risks arise when these ULPDs account for over 2% of a company’s annual revenue.The survey shows a decline in the proportion of respondents experiencing ULPDs exceeding 2% of their annual revenue, falling from 34% in 2021 to 26% in 2022. Despite an improvement in most Asian countries, the situation in Australia was different as the proportion of respondents with such ULPDs expanded from a high level of 56% in 2021 to 63% in 2022….
