The level of inflation that the UK is seeing currently means that many people are losing money on their savings in real terms, one sector commentator has asserted.

David Kuo, director of the Motley Fool, made his comments in response to the news from the Office for National Statistics that the consumer price index rose 0.4 per cent compared to the previous month to 3.4 per cent in March.

He described the figure as “appalling and yet not unexpected” and explained that it is forcing people to try to find financial products that will offer them a higher return than 4.4 per cent, since this is the level that the retail price index has reached.

Mr Kuo noted that such a high-return investment is hard to find.

“That is one of the reasons why people are shunning savings accounts and going for investment in the stock market,” he stated.

In his view, the inflation figures that the country is experiencing have been affected hugely by the government’s quantitative easing programme

A report by RBS and Natwest has found a growing number of small and medium-sized firms are suffering as their customers make late payments.

While late payments can be a major headache for many companies, it can be particularly harmful to SMEs, who rely on regular incoming payments.

If payments do not arrive on time, companies have to use their own funds to cover the delay.

According to the Federation of Small Businesses (FSB), approximately 4,000 firms collapsed in 2008 as a result of late payments.

In the last year alone, almost three-quarter of firms have suffered from late payments, according to research.

The research found that UK firms were owed around £62 billion in bills that were unpaid beyond the agreed timescale. Around a quarter of this was more than 120 days overdue.

Peter Ibbetson, Chairman Small Business, NatWest and RBS comments: “Bad debts and late payment of invoices are endemic problems for UK businesses. For more than one in ten (12%) firms, over 60% of all their invoices are paid late, causing major cash flow problems for many.”

However, Mr Ibbetson points out that there are services available to help companies alleviate the problem of late payments.