Financial Automation: How the Cloud Is Eliminating the Need to Recover Commercial Debt via the Courts

By Lynne Darcey Quigley, Founder & CEO of Know-it

A combination of skills shortages and Covid-related backlogs has compounded the judicial system into a state of crisis in recent years. Legal experts have warned that record long civil court delays will create complications for UK businesses, after data earlier this year showed claimants must now face 74 weeks waiting times before their cases are heard.

Technology automation has emerged as the innovative solution to help ease the tightened strain being felt by the court system. In particular, businesses can now bypass the courts when it comes to the commercial debt recovery process.

Offering UK businesses the chance to avoid the lengthy and often expensive process of recovering commercial debt through the court system could prove vital to the survival of many, in particular SMEs.

The judicial landscape

As touched on earlier, the UK court system is currently experiencing extensive backlogs across the UK civil justice system. Express Solicitors researched 8,500 fast track and multi-track claims to paint a clearer picture of the bottlenecks for civil justice in England and Wales. The east of England is the worst overall performer in England and Wales, with an average of 350 days elapsing between a Claim Form being served and a case completing the first costs and case management conference (CCMC). Such a vast amount of time, which many business owners, cannot afford to commit to waiting around for.

For businesses looking to recover debts via the court system, caution should be applied in the current climate as it will likely be an arduous and expensive process. The longer it takes to navigate the legal system, the increased strain placed on business cash flow will only become more threatening.

SMEs cannot afford to wait around for an already congested judicial system to hear their case as there is rarely a finishing line in sight. Instead, urgent action must be taken to ensure they do not fall victim to the effects of the late payment culture engulfing the UK, putting 440,000 small businesses at risk of collapse as a result of not being paid on time.

Automation to the rescue

The latest technologies are now on-hand to step in as an alternative route to the courts. Gone are the days of awaiting rescheduled hearings and case delays caused by backlogs. Now, businesses can look to technology as a seamless, more efficient way to recover any late payments they are owed.

Cloud-based technologies are now able to automate the entire credit management process for SMEs. The time saving benefits of this adoption immediately outperforms that of venturing through the court system. Automation immediately eradicates the need to wait around for the courts to come to an agreement to chase and collect payment.

Away from the time saved, automation also removes the headaches of mounting legal fees and complexity from the process of recovering debts. In short, business owners can remain focused on their work, rather than having to trawl through legal documents and commit even more cash into recovering the money than they should have to.

Why businesses should pay attention

Right now, businesses are facing a great deal of uncertainty in the current climate. Late payments are a threat facing businesses and professionals across the board. But SMEs often cannot sacrifice the same amount of time and resources to the same degree in comparison to their larger, more established competitors.

Having access to affordable solutions which not only save vital cash, but also automates and simplifies the entire credit management process could be the difference between sinking or swimming in these choppy financial waters.

Business owners no longer have to contend with the time consuming, complex nature of recovering debts through the judicial system. Cloud-based technology now offers finance teams a complete overview of their credit control. Allowing them to check customers, chase overdue payments and subsequently collect overdue payments.

Bypassing the arduous process of recovering debt through court and placing tech at the centre of their financial processes will mitigate any late payment headaches they may be experiencing. The cash flow crunch is now in full swing and more businesses, particularly SMEs, must be made aware of the solutions at their disposal to support them in recovering any overdue payment they may be owed.