Late payments are "destroying" many small companies, but firms can protect themselves by securing business insurance cover against loss of accounts receivable.
Research by the Irish Small and Medium Enterprises Association (ISME) shows that 44 per cent of companies in Ireland are experiencing payment delays of over three months.
The average waiting is 73 days, which could put considerable pressure on firms that are already struggling with access to credit and other factors associated with the recession.
According to the report, many big businesses and state agencies are deliberately delaying payments to small enterprises, even though their actions could cause job losses and business closures.
"When smaller businesses are not paid on time, they cannot in turn pay their suppliers and the vicious circle ends with the smallest and most vulnerable being forced to close down," said ISME chief executive Mark Fielding.
The survey looked at the experiencing of Irish small businesses, but bodies in the UK have also warned of the damage late payments are doing to the sector.
Earlier this year, the Federation of Small Businesses found that one in three payments from the public sector were being made late.
Business insurance policies usually cover loss of accounts receivable as standard.
