Each year Merion reviews the patterns visible across our referred debt portfolio and the broader data published by ASIC, CreditorWatch, and the ABS. The 2026 picture is notable: insolvency volumes have risen, average days to payment has extended further, and the industries under most pressure have shifted compared to 2024 and 2025. Here are the headline findings.
Insolvency volumes remain elevated
ASIC's external administration statistics for the year to June 2026 recorded over 12,000 company insolvencies — above the five-year average and continuing the trend that began when pandemic-era support measures wound down. Creditors voluntary liquidations remain the dominant mechanism, accounting for approximately 70% of appointments. Construction and hospitality together represent close to 40% of all appointments by industry.
Payment times have extended
The ABS' Business Indicators data shows that average creditor days for non-financial businesses reached 42 days in the year to March 2026, up from 38 days in 2023. For trade creditors on 30-day terms, this means the average customer is now paying 12 days late — a significant deterioration. The gap between large business payers (improving modestly under Payment Times Reporting obligations) and small business payers (worsening) is widening.
Recovery rates by debt age
Internal data from Merion's portfolio confirms the well-established pattern: debts referred within 60 days of the due date recover at significantly higher rates than those referred after 90 days. In 2026, the average time between a debt falling due and referral to an external agency increased slightly. Businesses waiting for internal collection to exhaust more options before referring are transferring to external recovery at an older average age.
Industries under most pressure in 2026
- Construction: subcontractor insolvency rates remain elevated; head contractor credit quality has deteriorated in residential.
- Hospitality: post-pandemic over-expansion continues to unwind; lease arrears and supplier debts are common referral types.
- Transport and logistics: fuel cost pressures and freight rate softness have squeezed margins; creditor disputes have increased.
- Retail (non-food): consumer spending constraint has flowed through to trade credit performance.
- Professional services: fee arrears referrals from accounting, legal, and consulting practices increased approximately 15% year-on-year.
What creditors should watch in 2027
The combination of higher insolvency rates and extended payment times creates a compounding risk: the older a debt becomes, the less likely the debtor remains solvent. Businesses that wait for 90 or 120 days before acting are increasingly finding that the debtor is already in administration or has closed.
Early referral — within 30 to 60 days of a payment default — remains the single most effective risk-reduction strategy available to a creditor. If your current policy is to wait longer than that before external action, 2026 data suggests the cost of that delay is rising.
Refer a debt to Merion or contact us to discuss how your receivables profile compares to industry benchmarks.