Half of NZ companies late in paying bills

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About 50 per cent of the country's trading companies have outstanding debt - and more than $12 million of that is three months overdue, a leading credit bureau says.

Statistics from Veda Advantage show 336,716 New Zealand companies have debt which they have failed to pay after 30 days.

Veda Advantage managing director John Roberts says tens of thousands of Kiwis - including business owners - are finding "they just can't pay their bills".

"They are going into arrears and then finding their credit record is affected. Defaults stay on credit reports for five years and will have a huge impact for anyone trying to obtain credit during that time."

Of the money owed, $12.2 million is overdue by 90 to 120 days. Roberts said it was likely that a lot of that debt would be written off, which would have a severe impact on creditors and affect business returns and the wider economy.

"There is no doubt that we are witnessing a fundamental shift in the economy, with consumers exercising caution and opting to save.

"Our statistics show there is a lot more pain to come but the big question is whether the swing to caution has gone too far making the economy slower, tighter and tougher for everyone."

Veda statistics also showed credit card applications for the nine months to September were down 13.5 per cent on the same period last year.

Applications for credit cards from baby- boomers - people born between 1946 and 1964 - were down 24.5 per cent year on year to September, while Gen X applications - 1961 to late 70s - were down 25.2 per cent for the same period.

Julian Smith, general manager of business accounting software company Myob, said its research showed 25 per cent of 1000 respondents were under extreme pressure because of the timing of customer payments. This was up 6 per cent since April.

Smith said late payments were causing business owners considerable pressure and concern.

"It's a lot worse now than it was during the height of the recession in July last year. It's not surprising, as businesses come out of the height of the global financial crisis, that there are still some health issues showing up in their practices."

Smith said younger business owners, who lacked the knowledge or experience, and small businesses of up to four employees were struggling the most at the moment.

The two sectors that have been affected the most post-recession are the constructing and manufacturing industries.

"The issues keeping business owners awake at night are cashflow, how they price goods in their business - GST is a big issue in the middle of many business owners' lives. Many are wondering how to price products and services with the change to make sure they get a good outcome, and that's a driver of profitability."

Smith said cashflow, profitability and late payments issues were "symptomatic of business under pressure, pressure for revenue and pressure to keep expenses down but still be profitable".