Ananda Shakespeare, CEO of Shakespeare Communications, a Dubai-based PR firm, is widely recognized for her distinguished journey in the media industry. With a wealth of experience that continues to inspire many, she has built a reputation for insightful perspectives and impactful work. Despite her demanding schedule, she graciously took time to sit down with us for an exclusive conversation on SMEs and the challenges they face. In this Q&A session, she shares her views, giving MoneyPetrol readers an understanding of the realities that shape businesses behind the scenes.
MP: What are the biggest financial and operational challenges SMEs face due to late payments from big business houses sometime?
ANANDA: Simply put, late payments choke cash flow. For SMEs, like my own company, that means stress on payroll, rent and supplier bills, plus higher financing costs when companies are sometimes forced to bridge gaps with overdrafts or invoice finance. Operationally, teams spend unproductive hours chasing approvals, POs and GRNs rather than serving clients. Hiring and retention suffer when you cannot confidently plan headcount. Growth projects get deferred because retained earnings are tied up as receivables. This is common in the UAE: more than half of B2B credit sales are paid late, which keeps working capital permanently tight for smaller firms.
MP: Why do some bigger companies delay payments to SMEs at times, and is it more a matter of their wrong policy, poor cash flows, or any other management issues?
ANANDA: I think late payments are usually systemic rather than malicious. Large organisations centralise procurement and accounts payable, which creates multi-layered approvals, vendor onboarding hurdles and strict cut-off cycles. They also manage working capital by stretching DPO, (Days Payable Outstanding) so standard terms creep from 30 to 60 or 90 days and even slippage beyond that is tolerated. Disputes about deliverables and missing paperwork are frequent blockers. Some groups do face cash-flow pressure, but policy and process complexity are the main causes in our experience. Of course, many companies here are local outlets of foreign entities, which creates another layer of payment complexity.
MP: Are there any industry guidelines for SME’s to tackle delayed payments?
ANANDA: To the best of my knowledge, there is no single UAE-wide “prompt payment code” for the private sector. There are, however, helpful reference points and tools.
Abu Dhabi, for example, accelerated government-invoice payments through its Sharaka platform and moved to clear invoices within set timeframes, which sets a standard many private buyers mirror.
Dubai announced faster payment cycles for SMEs in government procurement as well.
On the legal side, the UAE Commercial Transactions Law allows contractual late-payment interest and generally caps default interest at 9% per annum, while Dubai courts often apply 5% where no rate is agreed, so it pays to state a clear rate in contracts.
MP: How can UAE government intervene to help SME’s?
ANANDA: I’d love to see certain things in place. First, extend prompt-payment standards for government suppliers across all federal and emirate entities, with public dashboards that show average days to pay. Abu Dhabi’s Sharaka is a strong model. Second, mandate a maximum payment term to SMEs for large private buyers, with automatic late-payment interest and penalties. Thirdly, expand fast-track dispute resolution and small-claims processes for unpaid invoices, so SMEs can enforce claims without lengthy litigation. Fourth, scale up guaranteed invoice-financing channels and instant-payment infrastructure to reduce the cost of bridging receivables; solutions like Aani already make transfers instant, and wider adoption in B2B would help.
MP: Is a contract between two parties enough or there are some other ways?
ANANDA: Again, in my experience, a signed contract is essential but rarely enough when it comes to full on disputes. In the UAE you also need airtight execution mechanics: an approved PO before work starts, a detailed scope with milestones, acceptance criteria and who signs on completion, and the buyer’s vendor-registration done early so your invoice is system-ready.
You need to state payment terms, invoicing dates, the late-payment interest rate and a right to suspend services for non-payment. For larger engagements, you might consider adding a mobilisation advance, staged billing, retention limits and a parent-company guarantee if you are contracting with a (local) subsidiary. Where appropriate, it can be a good idea to consider credit insurance or selective invoice finance to smooth cash flow, and I’m aware that well-regulated providers operate locally for this purpose.
