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BALTIMORE, MD—In a finding that underscores persistent financial challenges for Baltimore entrepreneurs, a new survey from Advance Funds Network has named the city among the nation’s most untrustworthy regarding timely invoice payments.
The direct business loan lender polled 3,013 small business owners across the country to gauge local payment habits, revealing significant financial strain caused by late payments. Baltimore landed near the bottom of the rankings, emerging at #220 on the list, suggesting a challenging environment for vendors expecting prompt payment.
Baltimore Noted for Slow Disbursements
The survey paints a picture of local clients in Baltimore, including major institutions, as being slow in settling accounts. The press release noted that while the city is kept “humming” by large institutions like universities, hospitals, and local government contracts, their payment systems are often outdated, forcing vendors to “chasing checks through layers of approvals.”
In contrast, the study highlighted Clarksville, Tennessee, as the top city for reliable payments, followed by Glendale, California, and Vancouver, Washington.
The Cost of Waiting: Financial Strain for Vendors
The impact of late payments on small businesses is substantial, according to the survey data. When vendors are forced to wait, the consequences ripple through their operations:
20% reported they would have to delay payments to their own suppliers. 17% would be forced to reduce growth or investment plans. 15% indicated they might have to delay employee paychecks. 15% would need to rely more heavily on credit or loans. 10% stated that repeated delays could put them at risk of closure.
Only 25% of respondents claimed late payments would have no impact, marking them as the minority.
Common Excuses Heard by Small Businesses
The survey also detailed the most frequent excuses small business owners hear when chasing overdue invoices:
“We never got the invoice.” – cited by 33% of respondents. “The check’s in the mail.” – cited by 26%. “We need more time for approval.” – cited by 22%.
Broader Survey Insights
Beyond Baltimore’s ranking, the survey revealed general trends among small business payment habits. Nearly 4 in 10 business owners (41%) said they have stopped working with a client due to repeated late payments, highlighting a broken trust. Furthermore, a striking 74% of businesses would accept a smaller profit margin to ensure faster payment.
Industries cited as having the worst payment habits nationally included Healthcare (17%) and public service (16%).
Irving Betesh, CRO of Advance Funds Network, emphasized the broader implication: “Consistent, timely payments are the lifeblood of small business—yet too many still have to chase what they’ve already earned… It’s proof that reliability is still a competitive advantage.”
The full report can be viewed online here.
Image via Pixabay
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