‘Quick Pay’ Initiative Cuts Time in Half for Business to Get Paid by Federal Agencies

According to a letter from the U.S. Department of Energy, President Obama has announced a new initiative, known as Quick Pay, which is designed to cut the time it takes for Federal agencies to pay small businesses for contracted services in half.

This initiative, which is being rolled out ahead of the American Jobs Act unveiled by the President last week, should reduce payment processing time from 30 days to 15 days. The hope is that this will allow cash to flow to small businesses faster once the government has received the proper invoices from small business contractors. This flow of cash is expected to allow small business contractors to invest back into the economy and create more job growth.

This initiative, along with the administrations American Jobs Act is a comprehensive set of actions that the Obama Administration is undertaking to help companies grow and create jobs, improving American competitiveness.

In its letter, the DOE said that last year it had, “awarded over $7 billion in prime and sub contracts to small businesses. The Federal Government as a whole pays small businesses nearly $100 billion each year for goods and services. With Quick Pay, agencies are encouraged to take all reasonable steps to make payments as promptly as possible, improving cash flow for small businesses and providing them with a more predictable stream of resources.”

As Small Business Administrator Karen Mills said, now small business contractors “can put that money towards working capital, expanding their businesses, marketing their products, and creating jobs. Their financial footing gets stronger – permanently.” Quick Pay is expected to benefit tens of thousands of small businesses.