Small and medium-sized businesses in the UK are owed £24bn at any one time, according to figures released by the Law Society.

The data also showed that SMEs have to wait, on average, 41 days longer than the agreed timescale to receive payments from customers.

The Society claims that too few businesses are aware of the protections available to them and believes contracts between businesses, which include late payment clauses, should become a common feature in the SME market.

"Average commercial debts caused by late payments are high in the UK, and for SMEs a lack of cashflow can be crippling. With credit less available to those businesses from banks, late payments have a far more serious consequence for SMEs," said Robert Heslett, President of the Law Society.