AU small businesses are getting paid faster: What the data shows

Published Friday 30 October 2026

Table of contents

• What Xero Small Business Insights shows about late payments in Australia
• Why payment times improved this quarter
• How late payments vary across Australian states and territories
• The slow-payer problem hasn’t gone away
• What you can do to get paid sooner
• Stay on top of cash flow with Xero
• FAQs on late payments in Australia

Key takeaways

• Australian small businesses were paid 6.0 days late on average in the June quarter 2026, down from 6.9 days the quarter before.
• The average time to be paid fell to 22.9 days, but much of the improvement is seasonal and may be revised later.
• Late payments vary widely by state, from 2.5 days in the Australian Capital Territory to 6.9 days in Victoria.
• The slowest large-business payers are still stretching out, so tighter invoicing habits remain worth the effort.

What Xero Small Business Insights shows about late payments in Australia

Late payments are one of the clearest signals of cash flow pressure, so any improvement matters. The latest figures show Australian small businesses waited less time to be paid in the June quarter of 2026.

According to Xero Small Business Insights, invoices were paid 6.0 days late on average in the June quarter, an improvement from 6.9 days in the March quarter. The average time to be paid also fell, to 22.9 days from 24.2 days.

For context, the long-term average for late payments in Australia sits at around eight days. So the June quarter reading is below the multi-year norm, which is genuinely good news for cash flow.

Australia also sits mid-pack against the other countries Xero tracks. New Zealand small businesses were paid 4.7 days late, followed by Australia at 6.0 days, the UK at 8.3 days, the US at 8.5 days, and Canada at 11.3 days.

Why payment times improved this quarter

Before you bank on the trend continuing, it helps to know what's behind it. A big part of the June quarter improvement is seasonal.

The June quarter covers the end of the Australian financial year, when many businesses clear their books and settle outstanding invoices before 30 June. That tends to pull payment times down temporarily. Xero Small Business Insights flags that these end-of-financial-year gains are often revised up in later releases, so the improvement may look smaller once the data settles.

The wider quarter told a mixed story too. Small business sales grew 6.5% year on year, a healthy result but down from 7.9% the quarter before, as three interest rate rises and higher fuel prices weighed on customers. In that climate, faster payments are welcome, but worth treating with a little caution.

How late payments vary across Australian states and territories

Where you run your business makes a difference to how quickly you get paid. The June quarter data shows a clear spread across the states and territories.

On average, late payments by state and territory looked like this:

• Australian Capital Territory: 2.5 days late
• Tasmania: 4.0 days late
• Queensland: 4.7 days late
• Western Australia: 5.9 days late
• Northern Territory: 6.0 days late
• South Australia: 6.3 days late
• New South Wales: 6.5 days late
• Victoria: 6.9 days late

The gap in total time to be paid is just as wide, from 13.6 days in the Australian Capital Territory to 24.7 days in Victoria. If your customers are concentrated in the slower states, building a bit more buffer into your cash flow planning makes sense.

The slow-payer problem hasn't gone away

Averages can hide a tail of very slow payers, which is still a real problem for small suppliers. This is where large businesses come in.

Under the Australian Government's Payment Times Reporting Scheme, large businesses report how and when they pay their small suppliers, and a public register names both fast and slow payers. The Regulator's January 2026 update showed the 95th-percentile payment time, the slowest payments large businesses make, rose to 64 days from 58 days. In other words, average payment times held steady while the slowest payments got even slower.

That matters because a single large customer paying at 60 or 90 days can undo an otherwise healthy set of receivables. Keeping an eye on who pays you slowly, and factoring it into your terms, is still worth the effort even in a quarter where the headline numbers improved.

What you can do to get paid sooner

You can't control the economy, but you can shape your own payment habits. A few straightforward moves tend to make the biggest difference to how quickly invoices get paid:

• Set clear payment terms on every invoice, including the due date and accepted payment methods.
• Invoice promptly, ideally as soon as the work is done rather than at month end.
• Offer online payment options so customers can pay in a couple of clicks.
• Send automated reminders before and after the due date.
• Follow up quickly and politely on anything overdue.

This guide on reducing payment delays goes deeper on each of these, and the wider cash flow management guide covers how late payments fit into the bigger picture of keeping cash moving.

Stay on top of cash flow with Xero

Knowing when money is likely to land makes every other decision easier. Xero brings your invoices and bank feeds into one cash flow view, so you can spot slow payers early and plan around them.

Want a hand getting on top of cash flow and staying there? Get one month free.

FAQs on late payments in Australia

Here are quick answers to common questions about payment times for Australian small businesses.

How long do Australian small businesses wait to be paid?

Small businesses waited an average of 22.9 days to be paid in the June quarter of 2026, down from 24.2 days the previous quarter, according to Xero Small Business Insights.

How many days late are invoices paid in Australia?

Invoices were paid 6.0 days late on average in the June quarter of 2026, below the long-term average of around 8 days.

Are payment times in Australia getting better?

They improved in the June quarter, but much of the gain is a seasonal end-of-financial-year effect and may be partly reversed in later data.

Which states have the worst late payments?

Victoria had the longest average delay at 6.9 days late, while the Australian Capital Territory was fastest at 2.5 days late.

Do large businesses still pay small suppliers slowly?

Yes. The slowest large-business payments rose to 64 days at the 95th percentile in the Payment Times Reporting Scheme's January 2026 update, so slow payers remain a real risk.