Debate on Shortening Payment Terms for Swedish SMEs Gains Momentum

A recent debate has erupted over the necessity of adopting a British model to shorten payment terms for Swedish small and medium-sized enterprises (SMEs). Entrepreneur Dan Olofsson advocates for this move, arguing that prolonged payment timelines have created significant liquidity challenges for SMEs, compelling them to effectively serve as lenders to larger corporations.

The British government is proposing to implement a maximum payment period of 60 days for companies with over 250 employees, eventually reducing this to 45 days after five years. Olofsson highlights the strain this has placed on Swedish SMEs, resulting in increased financial burdens, heightened bankruptcy rates, and overall stagnation in growth.

Criticism has been directed at the Swedish government, particularly the Tidö coalition, for allegedly prioritizing the interests of large corporations while overlooking the pressing needs of SMEs. Olofsson noted that reasonable payment terms were customary in the past and could be reinstated. He urges the government to actively engage with SME representatives to better grasp the adverse effects of long payment terms on these businesses, contrasting with the often-prevalent narratives from larger firms.

Olofsson emphasizes that Sweden's economic policies should focus on job creation and the welfare of SMEs, rather than maintaining ties with larger businesses. The proposal echoes broader European efforts to curtail payment terms, raising the question of whether Sweden will adopt similar reforms to protect its SMEs.