Letter from the table: Make the 15‑day standard work alongside Indian law

Letter from the table

To the Cashflow Council,

I co-signed because a small supplier should not have to lend money to a large buyer simply because the buyer has more control over the payment process. I support the direction of CF-001: pay within 15 days, apply interest automatically when payment is late, and publish payment times. My stance is amend.

Here is the kind of delay I want the standard to address. On 1 June, I sent an invoice for ₹62,400 to a large buyer. The buyer acknowledged receipt and acceptance on 2 June. The written terms allowed 30 days to pay, so the due date was 2 July. The invoice was not disputed. I sent a reminder on 18 June, then another on 3 July. The payment arrived on 28 July: 26 days after the agreed deadline.

That money had a place in my plans before it had a place in my account. I had set it aside for rent, a supplier bill and wages. When it did not arrive, I moved money between accounts and postponed one payment of my own. None of that appears in the buyer’s record of the transaction. From the buyer’s side, the invoice was a line awaiting a payment run. From mine, it was time spent checking, reminding and trying to decide how much pressure I could apply without risking future work.

India already has a legal framework that matters here. Under section 15 of the Micro, Small and Medium Enterprises Development Act, a buyer must pay by the agreed date; the agreed period cannot exceed 45 days from acceptance or deemed acceptance. If there is no written agreement,

payment is due before the appointed day, which cannot be later than 15 days from acceptance or deemed acceptance. Section 16 provides for compound interest with monthly rests at three times the RBI bank rate. Section 43B(h) of the Income-tax Act also links a buyer’s deduction for sums payable to a micro or small enterprise to actual payment, subject to the statutory rules.

I am registered as a micro enterprise, and I looked at the MSME Samadhaan process and the route to a Micro and Small Enterprises Facilitation Council. I collected the invoice, proof that it had been accepted, the written terms and my reminders. I did not turn the matter into a formal claim. That was a practical choice, not a sign that the delay was acceptable. Preparing documents takes time; pursuing a claim can complicate a relationship; and the amount is consequential to a small business without making a long process easy to absorb.

My first amendment is to make clear that the 15-day period is a ceiling for the standard, not permission to weaken stronger rights in local law or an existing contract. In my case, the buyer’s written 30-day term was within India’s 45-day statutory maximum. Under CF-001, the buyer would instead have to pay within 15 days of an undisputed invoice. That is a real improvement. The standard should say plainly that it adds a stronger expectation where applicable, while preserving any shorter deadline and every statutory remedy. It must not be presented as replacing local law.

Second, define what counts as a genuine dispute and how quickly it must be raised. A buyer should identify the specific amount and reason in writing, promptly after receiving the invoice. A dispute about one item should not stop payment of the undisputed balance or restart the clock on the whole invoice. Otherwise a buyer can turn “undisputed invoice” into a loophole by leaving a query open without saying what is wrong.

Third, automatic interest should not require a small supplier to make a second demand. The standard should explain how interest is calculated and should preserve statutory interest where local law provides a stronger entitlement. A published payment-time figure should also describe what is

being measured: the time from invoice receipt or acceptance to cleared payment, the share paid within the deadline, and how disputed invoices are treated. Buyers should not be able to improve a headline number simply by changing when they log an invoice.

These amendments would make the standard more usable, not less ambitious. Fifteen days matters because small suppliers often cannot finance a large buyer’s working capital. Clear dispute rules would protect buyers with a genuine concern, while keeping routine processing delays from becoming the supplier’s burden. Automatic interest and meaningful reporting would make the promise visible and checkable.

Notes and sources

Sources

1. India: payments to micro and small enterprises under section 43B(h) and the MSMED Act