// definition
Payment arrears
Overdue payment obligations
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Short definition
Amounts due that remain unpaid after the applicable deadline. For public procurement, delivery, invoice validation, the due date and settlement are separate stages. A claim awaiting validation cannot automatically be counted as recognised arrears.
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Knowledge map
Intuition
Once the payment deadline passes, the supplier’s cash finances its customer’s delay.
Primary sources
- Flynn and Pessoa, IMF, 2014Definitions and arrears-clearance strategies.