Payment delays intensify global working capital pressure

By Vriti Gothi

Late payments are no longer a marginal inefficiency in global trade they now account for 37% of the total payment cycle worldwide, according to new analysis released by Order-to-Cash AI company Sidetrade.

Drawing on more than $8 trillion in anonymised B2B transactions from over 42 million buying companies, the company’s Data Lake indicates that contractual payment terms alone do not determine when suppliers receive cash. Instead, operational payment discipline and invoice management practices are proving decisive in shaping real payment timelines.

Globally, businesses took an average of 51 days to get paid in 2025. Of that total, 32 days reflected contractual payment terms, while 19 days represented delays beyond agreed-upon due dates. That delay component now constitutes more than a third of the full days-to-pay cycle, introducing uncertainty into cash-flow forecasting and increasing working capital pressure for suppliers.

In a volatile macroeconomic environment marked by tighter liquidity conditions and rising financing costs, extended payment delays effectively transfer funding burdens from buyers to suppliers. For multinational enterprises operating across jurisdictions, disparities in payment behaviour translate directly into uneven cash exposure and balance sheet strain.

Regional differences are pronounced. The Netherlands sets a global benchmark with an average of 40 days-to-pay, including just 12 days of delay. Germany, Sweden, Finland and the Czech Republic follow closely with comparatively disciplined payment performance. By contrast, India records an average of 77 days-to-pay, driven by 43 days of delay beyond contractual terms. The resulting gap underscores the scale of working capital exposure facing global suppliers.

Europe overall outperforms the United States in payment discipline, averaging 18 days of delay compared with 29 days in the US. Yet regulatory alignment within the European Union does not guarantee uniform outcomes. Spain and parts of Southern and Eastern Europe continue to lag behind northern counterparts despite operating under similar statutory frameworks. The data suggests that legal payment deadlines alone are insufficient to enforce timely settlement in practice.

In the United States, the headline average delay of 25 days conceals significant industry variation. Financial Services, Insurance and Real Estate sectors average 57 days-to-pay, including 27 days of delay, while Manufacturing and HR Services pay materially faster. The divergence highlights the influence of sector-specific approval chains, dispute processes and accounts receivable management structures on payment performance.

“Late payments are structural and consistently exceed statutory limits,” said Mark Sheldon, CTO at Sidetrade. “For policymakers, they offer real-time insight into underlying economic pressures. For enterprises, payment delays undermine cash forecasting, inflate accounts receivable costs, and weaken balance-sheet confidence. Renegotiating commercial terms treats the symptom. Controlling the Order-to-Cash cycle addresses the cause.”

Sidetrade attributes its insights to its proprietary Data Lake, which continuously aggregates anonymised global payment behavior across industries and geographies. In 2025 alone, the platform captured approximately 285 million invoices representing $1.7 trillion in transaction value. The company positions its AI engine, Aimie, as an autonomous decisioning system trained on this domain-specific dataset to support collections prioritisation, dispute resolution, credit risk assessment and cash forecasting.

Beyond operational considerations, the findings position payment behavior as a macroeconomic barometer. When delays widen, they reflect buyers’ efforts to optimise working capital, often signalling underlying economic pressure within sectors and regions. For finance leaders, the ability to convert revenue into predictable cash flows is increasingly central to resilience.

With nearly 40% of global payment cycles now occurring beyond due dates, late payments are no longer an episodic friction point. They represent a structural drag on cash-flow predictability and, by extension, on broader economic stability.