For construction sector, cash continues to flow
Survey finds that many are paying their debts when asked
Cash continues to flow through the construction sector, a survey has indicated, with many creditors adopting a “business as usual” approach when asked by building service and supply firms to pay their bills.
The survey, carried out by the Malta Association of Credit Management, found that 55 per cent of construction sector respondents said that the COVID-19 crisis has had no impact on their cash flow to-date.
That contrasts with findings in similar surveys the MACM did among car and food suppliers, where just 20 per cent and 30 per cent of respondents said their cash flow was unaffected.
Construction work has continued almost uninterrupted throughout the coronavirus pandemic, unlike many other sectors which have been forced to shut down.
Survey respondents said that just one in every three debtors had reacted negatively when they were asked for money due. The other 64 per cent had adopted a “business as usual” paying attitude, the MACM noted.
Among those who were struggling to collect money owed to them, one in every five said that they were down anything between 80 and 100 per cent. The majority of those with cash flow issues – 60 per cent – said they were anything between 0 and 20 per cent.
None of those who were struggling to get paid had offered customers any form of payment incentive to encourage them to pay.
One in three – 36 per cent – said they had applied for a form of government COVID-19 financial aid. The rest said they did not and had no intention to do so, either because they are not eligible for aid, because their cash flow is unaffected or because they have their own capital to use.
None of the respondents had taken any action against those who were not paying, although 18 per cent of respondents said they planned to file legal action or deploy “harsher collection methods” in the future.
The MACM did not say how many respondents took part in the survey