Visa helps meet European late payment ruling

Payment cards can provide an easy solution to meet a new a European Council ruling that insists businesses and public sector organisations pay their bills in 30 days or less.

The directive is designed to ensure that small firms no longer face financial problems due to the late payment of bills.

However, Visa can ensure public sector payment transactions are completed even faster - and without a complex invoice payment process.

Suppliers will receive funds within four days if they accept Visa whereas public sector accounts are typically not due for payment for up 37 days or more.

The Council’s directive, intended to bolster solvency, innovation and jobs, was endorsed by the European Parliament in a plenary session on 20 October 2010.

The Parliament’s rapporteur Barbara Weiler said: “This directive will pave the way for a whole new payment culture.

“We have aimed to ensure that the rights of the smaller companies are enforced in order to improve liquidity and create a better climate for investments into new jobs”.

She added that Member States should not wait up to two years to put the new rules into effect, but begin transposing them into their national laws as of January 2011.