Building a responsible payment culture in the EU

Improving the effectiveness of the Late Payment Directive (2011/7/EU)

FECMA works with the European Commision to improve the payment culture 

building a responsible payment culture in the EU

Study on building a responsible payment culture in the EU

Improving the effectiveness of the Late Payment Directive (2011/7/EU)


Within the European Union (EU), the problem of late payments is addressed by Directive 2011/7/EU, commonly referred to as the Late Payment Directive (LPD). The theme is also addressed by Directive 2019/633/EU, which sets maximum payment terms in the agricultural and food supply chain, and at the national level, with legislative initiatives to combat late payments recently adopted or under discussion in Poland, The Netherlands, and Spain.

Recently the situation has shown signs of improvement. Indeed, according to the Survey on the Access to Finance of Enterprises (SAFE), in 2021, 42% of EU businesses experienced problems with payment delays, of which 12% faced regular payment problems and 30% had occasional problems. This marks an improvement compared with 2019 when 49% of EU enterprises faced payment problems, of which 17% on a regular basis. However, in 8 Member States more than 50% of businesses still report problems with late payments.

The theme of payment behaviour has attracted considerable attention from decision makers. In its Resolution of 17 January 2019 on the implementation of the LPD, the European Parliament called on the Commission and the Member States “to foster ‘a decisive shift towards a culture of prompt payment’”. The theme also figured prominently in the SME Strategy adopted by the Commission in 2020, which noted the need for “a decisive shift towards a new business culture in which prompt payment is the norm”. Accordingly, the Commission “will support the implementation of the Late Payment Directive by equipping it with strong monitoring and enforcement tools.”

The purpose of the study is to collect evidence and provide inputs on a series of possible actions aimed at fostering the effectiveness of the LPD. The work was articulated in 6 thematic areas, dealing respectively with:

(i) identifying the conditions for the creation of an EU observatory on payment behaviour;

(ii) facilitating the uptake of financial tools addressing the issues originated by poor payment behaviour and fostering the use of e-invoicing;

(iii) facilitating access to credit information on prospective clients;

(iv) implementing synergies between public procurement and prompt payment objectives;

(v) fostering the use of Alternative Dispute Resolution tools to settle payment delays disputes;

(vi) enhancing SMEs’ credit management capabilities.

The study relied on a combination of desk work and interactions with stakeholders, including: (i) the review of over 250 documentary sources and some 150 websites; (ii) interviews with representatives of more than 100 entities (Member States authorities, business associations & professional groupings, enterprises, academicians, etc.); (iii) two targeted consultations with ADR professionals and public procurement authorities, and (iv) a consultation with some 700 SMEs, implemented through the Enterprise Europe Network.

EU Payment Observatory

Improving the effectiveness of the Late Payment Directive (2011/7/EU)


Late payments in commercial transactions have multiple damaging effects, particularly amongst SMEs, causing one out of four bankruptcies in the European Union. The Late Payment Directive, which is currently under review, aims to address this issue and improve B-2-B and B-2-G payment culture. One of the main problems identified since its adoption in 2011 is the lack of monitoring tools which has hampered a more effective implementation of the Directive and its enforcement.

The EU Observatory of Payments in Commercial Transactions (“EU Payment Observatory”) purpose is to fill that gap. The Observatory monitors trends and developments on payment performance and behaviour in commercial transactions in the EU. It also collects, analyses and disseminates data, provides a repository of relevant initiatives and policy documents, and through its regular activities presents an overview of trends and developments in payment behaviour across the EU.

The Observatory has three main objectives:

  • The collection, validation and consolidation of data on payments in commercial transactions, specifically B2B (business to business) and G2B (government to business).

  • The mapping of documents and policy measures and any other relevant initiatives put in place by public authorities or other entities to combat late payments in commercial transactions and, more generally, to promote a prompt payment culture in the business environment.

  • The analysis and dissemination of the data and information collected and their dissemination through the publication of annual and thematic reports, as well as the organisation of events.


Stakeholder's Forum

The Stakeholder Forum is an informal group that gives operational support and advice to the EU Payment Observatory.

The Stakeholder's Forum also provides qualitative and quantitative information based on the expertise that assist the analysis done by the Observatory and contribute to the dissemination of its activities.