Partnership to help SMEs say goodbye to late payments

Global small-business platform Xero has announced an expansion of its partnership with UK-based firm GoCardless to Australia. The integration allows small businesses to automate their payment collection – helping to cut late payments – and reconciliation via Direct Debit, improving cashflow and reducing business administration.

Late payments are a constant source of stress for small-business owners. Around 40 per cent of small businesses fail in the first four years according to the Australian Bureau of Statistics, with the lion’s share being due to poor cashflow.

According to Xero’s Small Business Insight April data, Australian Xero small businesses were paid on average in 36 days for invoices with 30-day payment terms.

Xero’s integration with GoCardless will help to solve these payment problems. By using Direct Debit, small businesses can collect payments automatically as soon as they are due avoiding those uncomfortable conversations chasing up their overdue invoices. This in turn makes it much easier to accurately forecast cashflow as business owners know when their invoices will be paid.

The GoCardless for Xero integration provides a seamless set up experience connecting a user’s GoCardless and Xero account with no additional configuration required. Once the simple set up is complete and customers have signed up, payments are automatically collected and marked as paid within the Xero account, saving hours of admin time and ensuring accurate data within the accounting platform.

Ian Boyd, Financial Industry Director at Xero Australia, said, “Direct Debit payments in Australia have traditionally only been available for major companies who can afford the necessary complex systems and processes. By working with GoCardless and making more payment options available, we are helping small business to be as efficient and effective as big business.

“The aim is to spend less time chasing payments and to get paid faster. This then gives small business owners more time focusing on things that matter to them, like growing the business.”

Xero and GoCardless have worked together for more than 18 months in the UK, where 80 per cent of small businesses surveyed have seen reductions in payment times and improvements in cashflow as a result of taking payments through the integration.

Hiroki Takeuchi, Founder and CEO, GoCardless, said, “GoCardless is democratising Direct Debit for small businesses. We have modernised the process with innovative technology partners such as Xero and removed the stress and complexity.

“We’re delighted to extend our existing successful partnership beyond the UK and help small businesses take control of payments to ensure they get paid on time, every time.”

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