UK businesses with a turnover of under £1m (€1.39m) waited an average of 72 days for payments of invoices in the past year, according to a research by Asset Based Finance Association (ABFA).

The research found that over the past year the smallest businesses waited an average of 11 days longer for payment than they did at the peak of the recession (2009) and a day more than last year.

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In contrast, businesses with turnovers exceeding £500m recorded a waiting time of 47 days, a day less than the previous year and eight days more than 2009 figures.

Jeff Longhurst, chief executive of the ABFA, said: "Despite the economic recovery gathering pace, payment delays are getting worse, not better, for small businesses."

"It’s very worrying to see that the trend is going in the wrong direction for smaller businesses, in spite of what is a more benign business climate than we have seen for several years. The benefits of the recovery are not being felt equally."

"Delays to payments put enormous pressure on small businesses’ cash flow – they have to meet overheads, tax bills and their own supplier invoices whether they’ve been paid or not. Smaller businesses are particularly vulnerable. No matter how successful they are, if just a few invoices aren’t paid on time, they could end up in serious financial trouble."

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The government’s new Small Business Conciliation Service, announced after the general election by Business Secretary Sajid Javid, aims to resolve disputes between SMEs and their customers over late and extended payments.

Longhurst said: "Whilst we fully support it, it remains to be seen whether the launch of another mechanism for SMEs to report their clients for late payment will have more of an impact on the issue than previous efforts."

"Businesses already have means of redress for late payment, such as the ability to charge interest, but this is a route that many are reluctant to take if they want to get repeat business from clients. This boils down to the inequality between large and small businesses and we need cultural change."

"Though efforts to improve the situation are laudable, the reality is that small businesses that don’t want to jeopardise their customer relationships often feel they have no option but to just put up with poor payment practices."