Experian Information Services Malaysia released its latest ‘Industry Debts Turned Cash’ Indicators on payment trends in 2019 and 2020

The Trade Bureau platform of Experian Information Services (Malaysia) has announced the 2019 and 2020 Industry Debts Turned Cash (i-DTC) which measured payment data between 1Q 2019 to 4Q 2020.

i-DTC measures the average number of days companies take to pay their creditors after the invoice date. It is based on more than 500,000 payment records on business corporations and SMEs across a spectrum of industries facilitating a clearer picture of how fast companies are paying their creditors. In this study, the seven selected industries of construction, hospitality and food/beverage, manufacturing, retail, services, transportation and storage, and wholesale were examined.

While businesses continue to be impacted by the effects of COVID-19, the payment trend in 2020 has shown signs of recovery from the worst of the COVID-19 effects.

Overall, the average i-DTC for the seven industries increased by 10 days from 78 days in April 2020 to a high of 88 days in June 2020.

According to Dawn Lai, Chief Executive Officer of Experian Information Services (Malaysia), “There is a noticeable recovery tracked in 3Q and 4Q of 2020 in the wider Malaysian economy. This positive trend is likely attributed to the fact that most of the Malaysian economy re-opened post the MCO and with business activity resuming to some normalcy since June 2020. This, coupled with the government’s ongoing implementation of the Prihatin and Penjana economic stimulus packages, have contributed to enhanced business activity which has helped boost market confidence.

“Comparing data from July till December 2020, based on a month-on-month comparison, Lai noted that all seven industries saw an improvement in i-DTC days with three industries registering the largest improvements – hospitality and food/beverage industry (18 days), retail (16 days) and construction industry (15 days).”

According to Lai, the hospitality and food/beverage industries built on the recent signs of improvement in September and October 2020 through the Recovery Movement Control Order (RMCO) phase which spurred more business activity. Many construction projects also resumed operations in that period.

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Source:  Experian Press Release