Debtors getting younger and younger

Every sixth bill is paid too late

A good quarter of all debtors are young people or young adults up to the age of 30.

(Bild: ©stadtratte - stock.adobe.com)

Austrians continue to have a good payment record - despite the heavy burden of high inflation. Only one in six invoices is paid late. In some cases, the public sector is even paying faster than in the previous year. What is less good is that those who need a debt collection agency are getting younger and younger.

"The mood in the economy is not picking up," explains Ricardo-José Vybiral, head of KSV1870. Only just under one in two (48%) companies operating in our country rate the business situation as "good" or "very good". More than a quarter (27 percent) report declining sales, according to a KSV1870 survey. The retail sector remains a problem child, with only around one in three businesses doing "well" or "very well".

It is therefore all the more pleasing that payment morale remains high. Private individuals pay their bills after 13 days on average, municipalities after 24 days and companies after 25 days. The federal government pays after 35 days (+1 day compared to the previous year). On the other hand, the federal states improved by two to 31 days and municipalities by one to 24 days.

Almost nine out of ten private individuals pay on time
Private individuals pay their bills on time in 87 percent of all cases. However, they are clearly holding back when it comes to consumer spending. Every second entrepreneur (51%) notes that private households are buying less compared to the previous year. The construction industry and retail are particularly affected. "Private consumption is essential if we are to see a flourishing economy again," explains Vybiral.

Private consumption is essential in order to experience a flourishing economy again

Ricardo-José Vybiral, Chef des KSV1870

Bild: Georg Wilke, Krone KREATIV

However, collecting the money is more difficult
Even if morale is good, the effort for businesses is increasing. 46 percent state that it has become more difficult to get private individuals to pay. They often wait until "the last minute" and payment terms are exhausted, they say.

Debt collectors are getting younger and younger
On the other hand, the development of the age structure is less encouraging. "Debtors are getting younger and younger," emphasizes Walter Koch, Managing Director of KSV1870 Forderungsmanagement GmbH. Almost a quarter (24 percent) of all debt collectors are between 21 and 30 years old. Two years ago it was only 23 percent. The increase is even more striking among the under-20s. While this group accounted for just 0.8% of all debtors in 2022, they currently make up a whopping 3% - that's more than a threefold increase in two years.

Demands on the future government
"The companies have given us something, a list of demands with their wishes for the new government," explains Vybiral. In addition to the classics, there are also new topics, emphasizes the credit protector. Here is an overview:

• Reduction or lower ancillary wage costs
• Reduction of bureaucracy
• Fewer taxes and more relief
• "Work must be worthwhile again", unemployment benefits urgently need to be reformed.
• Energy costs must be reduced so that companies are (internationally) competitive again.
• Targeted support for SMEs
• Comprehensive education reform

It will be interesting to see which of these demands will be implemented by a future government.