The Fair Payment Code (FPC), launched on December 3, 2024, by the UK’s Small Business Commissioner with support from the Department of Business and Trade, aims to promote prompt and fair payment practices across businesses of all sizes. Replacing the previous Prompt Payment Code, the FPC introduces a tiered award system to recognize and encourage exemplary payment behaviors.
Award Tiers:
- Gold Award: Granted to companies that pay at least 95% of all invoices within 30 days.
- Silver Award: For companies paying at least 95% of invoices from small businesses (with fewer than 50 employees) within 30 days, and all other invoices within 60 days.
- Bronze Award: For companies paying at least 95% of all invoices within 60 days.
In addition to meeting these payment criteria, awardees commit to the FPC’s principles of clarity, fairness, and collaboration with their suppliers. The Code aspires to elevate payment standards, encouraging businesses to progress through the award tiers over time. Each award is valid for two years, after which companies must reapply, ensuring ongoing compliance and engagement.
The FPC also establishes a robust complaint system, allowing businesses to report non-compliance or breaches of the Code’s principles. This framework aims to foster a culture of prompt payments, thereby enhancing the resilience and sustainability of supply chains across the UK.
The Prompt Payment Code has been replaced by the Fair Payment Code.
3 December 2024
