The 2025 edition of Coface’s annual survey on payment discipline among German companies reveals a further decline in payment behaviour, driven by growing geopolitical instability and domestic uncertainty. Despite the worsening trends, Germany continues to distinguish itself from other markets covered in the survey by maintaining comparatively short payment terms and lower-than-average delays.

Record share of companies offering deferred payments

This year, a record 84% of German businesses are granting trade credit - the highest since 2016 - indicating a stronger reliance on deferred payment terms. In parallel, Germany’s traditional preference for short payment windows is not weakening: 92% of the surveyed companies require settlement within 60 days, matching the 2016 level. The average term remains almost unchanged at 32.5 days, compared to 32.1 in the previous year. Over half of businesses (55%) report that offering deferred payment is now standard practice in their sector.

Delays on the rise for a fourth year running

Payment delays were reported by 81% of companies, a rise of 3 percentage points compared to 2024. This figure is approaching the high of 85% seen in 2019. The average delay duration rose to 31.8 days - one day longer than in the previous year - yet still far below the pre-pandemic average of 39.7 days. The data suggests that financial stress remains a key issue for businesses, reinforcing the need for heightened vigilance as they look ahead to 2026.

Around 12% of surveyed firms indicate that they are dealing with long-standing unpaid receivables - overdue by six months to two years - which amount to more than 2% of their annual turnover. While this is slightly down from 2024, it remains significantly above pre-COVID levels. The construction sector is notably vulnerable, with nearly one in four companies (24%) reporting such risks. Coface’s own experience shows that 80% of receivables in this category are never recovered, posing a substantial threat to business health and a broader warning sign for the economy.

German outlook: cautious hopes amid persistent instability

After several years of stagnation, German companies are beginning to see light at the end of the tunnel. While the overall sentiment for 2025 is still negative - with pessimists outnumbering optimists by 17 percentage points - expectations for 2026 have shifted. Optimists now exceed pessimists by 16 points, supported by anticipated state-led incentives in defense spending, infrastructure, environmental transition, and tax relief for businesses. These developments nurture the hope that Germany can retain its economic leadership in Europe, even as internal and global headwinds persist.

Risks spreading to Bulgaria through export links

Plamen Dimitrov, Coface’s Country Manager for Bulgaria, warns that the decline in payment reliability in Germany is already having real-world effects for Bulgarian exporters. Given Bulgaria’s strong dependence on German industry and its export-led economy, the prolonged extension of payment terms and rising insolvencies signal a deeper stagnation. Many Bulgarian companies are already feeling the impact of weakening German counterparts, with insolvency rates at their highest in nearly a decade. The most vulnerable segment is the German automotive industry - a critical link in Bulgaria’s own supply and export chains.

Germany still a key market, but risk management is growing

Despite these mounting difficulties, German firms still regard their home market, along with the EU and EFTA countries, as the most attractive for business. In contrast, confidence in the United States continues to slip. US popularity is now similar to levels last seen during Donald Trump’s first presidential term, likely due to the volatility of American trade policy. To manage growing uncertainty, 23% of companies have already adopted “de-risking” strategies, including diversifying suppliers, securing payment guarantees, and relocating parts of their production. This trend is set to grow - by 2028, more than half of businesses (54%) plan to implement such measures, particularly in sectors focused on exports.

The complications faced by exporters are multiplying as global instability takes its toll. From the unpredictable trade stance of the US to continued disruptions in maritime traffic through the Suez Canal due to Houthi rebel activity, geopolitical crises - including the wars in Ukraine and the Middle East - are reshaping the landscape of international commerce.

“Although 2026 looks more hopeful on paper, in the immediate term we’re seeing worsening payment practices, which go hand in hand with the surge in insolvencies - currently at a 10-year high,” says Christiane von Berg, Regional Economist for Coface in Germany, Austria, Switzerland, and the Benelux region.

Source: Coface press release