The companies that became banks without choosing to

A supplier delivers on time. The invoice is correct. The customer accepts the work.

Then the supplier waits.

Payroll falls due. Materials must be purchased. The next order needs funding. The customer’s unpaid invoice remains an asset in the accounts, but it cannot be spent.

The supplier is now performing two jobs: producing what it sells and financing the company that bought it.

Trade credit is an established part of commerce. What deserves closer attention is how easily a financing burden can move towards the company with the least ability to absorb it.

My argument is that payment behaviour belongs at the centre of capital-allocation analysis.

On 7 October, Qonto launched its Insights platform. Its September figures show 31.6% of settled invoices paid late and an average delay of 58.6 days. [1]

The methodology matters. This is a platform-specific sample across France, Germany, Italy and Spain. The index counts matched, paid invoices received more than seven days after their due date. Still-unpaid invoices are excluded. We cannot extrapolate these figures to all European firms, treat them as default rates or infer that all delays reflect deliberate behaviour. [2]

Yet the broader financing problem is visible elsewhere. The French Payment Observatory’s September release estimates that eliminating payment delays would have left SMEs and microbusinesses with €13bn in additional cash. It also reports that, in the underlying 2024 data, average payment periods improved while the longest-paying 10% of businesses deteriorated. Averages can conceal growing pressure in the worst relationships. [3]

That combination deserves attention: persistent financing needs can coexist with apparently improving aggregate indicators.

Imagine a supplier with €12m in annual credit sales, spread evenly across the year. Suppose its collection period permanently increases by 30 days.

The additional receivables are approximately:

€12,000,000 × 30 ÷ 365 = €986,301.

Assume the entire increase is funded with borrowing at 8%. The additional annual financing cost is approximately €78,904.

These are illustrative assumptions, excluding VAT, seasonality, fees and changes in the supplier’s own payment terms. They isolate the effect of slower collections.

The company has not expanded capacity or generated extra sales. It needs almost €1m more financing simply to support the same annual business.

A one-percentage-point reduction in the interest rate on €2m of borrowing would save €20,000 annually. In this example, a deterioration in payment behaviour more than outweighs that saving.

This is why the cost of money and the time spent waiting for money must be analysed together.

There is a second, less comfortable implication.

Suppose a financially strong buyer can borrow at 4%, while its smaller supplier borrows at 10%. If the buyer permanently retains €1m that would otherwise have been paid to the supplier, it might avoid €40,000 in annual interest. The supplier, assuming it must borrow the replacement cash, incurs €100,000.

The combined financing cost rises by €60,000.

This is a hypothetical example, not evidence that every large buyer has cheaper funding than every supplier. But it demonstrates why improving one company’s working capital does not necessarily improve the economics of its production network.

Negotiating power can move the funding requirement in the opposite direction to financial efficiency.

The resulting pressure need not stop at the first supplier. Intrum’s 2026 report, based on 8,385 respondents in 20 European countries surveyed between December 2025 and February 2026, found that 62% said late payments had increased their failure to meet payment deadlines with their own suppliers. [4]

A delay can therefore become somebody else’s delay.

This does not establish an imminent systemic crisis. It does suggest that credit analysis should examine chains of payment dependency, especially where a small number of buyers dominate a supplier’s revenues.

Investors face a related problem: the quality of cash generation.

An increase in operating cash flow may reflect better margins, faster collections or lower inventory requirements. It may also reflect a longer wait imposed on suppliers.

The cash is real. The interpretation still matters.

A permanent increase in payment days produces a working-capital release during the transition. Holding those days constant does not repeat the same release every year. Treating that initial improvement as recurring operating performance can overstate sustainable cash generation.

The analysis should therefore connect cash flow with payable days, overdue balances, purchasing volumes, seasonality and supplier-financing disclosures. Rising payable days alone are not proof of abusive conduct: changes in business mix or mutually agreed terms may explain them.

The commercial consequences also matter. A supplier can respond by raising prices, reducing investment, prioritising other customers or requiring advance payment. A buyer may recover less of its apparent cash advantage once those responses are included.

For suppliers, customer profitability should include the cost of carrying receivables, collection work and expected credit losses. Two customers purchasing identical products at identical prices can generate very different economic returns.

For buyers, procurement and treasury should assess critical suppliers together. The cheapest quoted component may become expensive if the producer cannot finance continued delivery.

There is a constructive role for finance here. Voluntary supplier-financing arrangements can let a small business benefit from a stronger buyer’s credit standing. Their value should be judged against the original payment terms and the full cost borne by the supplier. An earlier payment after an imposed extension is not automatically an improvement.

Digital invoicing can help resolve errors and clarify when an invoice was received, accepted and due. Faster bank transfers can reduce settlement delays. Neither necessarily changes a buyer’s incentive to retain cash.

The practical question is whether the system rewards timely payment as strongly as it rewards cash retention.

I would put four measures alongside conventional working-capital targets: the overdue share of payables, the financing cost imposed on critical suppliers, customer profitability after collection costs, and the proportion of cash improvement attributable to non-recurring working-capital movements.

That would make the financing choices inside commercial contracts more visible.

Before designing another programme to help small firms borrow, it is worth asking how much borrowing would become unnecessary if customers respected the payment terms they already accepted.

A healthy balance sheet should be assessed partly by what it requires of the balance sheets around it.

Sources and methodology

[1] Qonto, launch announcement, 7 October 2026; September 2026 observations:
https://qonto.com/en/press

[2] Qonto Late Payments Index methodology:
https://qonto.com/en/insights/index/late-payments

[3] Banque de France / Observatoire des délais de paiement, release dated 24 September 2026; report combines observations with different reference periods:
https://www.banque-france.fr/fr/communiques-de-presse/le-rapport-annuel-2025-de-lobservatoire-des-delais-de-paiement-des-resultats-contrastes-selon-les

[4] Intrum, European Payment Report 2026, published April 2026; survey methodology p. 2 and propagation of late payments p. 14:
https://www.intrum.com/media/ymyjm5fm/intrum_epr-2026.pdf

The numerical company examples are original illustrative calculations, not observed company results or forecasts.