Bulgaria’s 57% Problem: Why SME Cash Flow Is a Settlement Speed Problem

The official State of SMEs in Bulgaria 2024 report (IANMSP) landed recently. Here is what it says, and what it lets us say about the rails underneath the sector.

57.1% of Bulgarian SMEs report overdue receivables from clients. 19.4% report overdue payments to their own suppliers. Both numbers come from the IANMSP 2025 survey published in the official State of SMEs in Bulgaria, 2024 report.

These are not isolated findings. The same survey records that 36.9% of SMEs saw annual revenue fall in 2024, 15.2% closed the year at a loss (up from 11% in 2023), and 64.5% of SMEs can self-fund at most 30% of the investments they say they need over the next three years. The report draws the line directly: insufficient revenue is connected to the lack of discipline and correctness in settlements between enterprises.

That line is the one payment rails are supposed to remove. They do not.

This Is a Settlement Problem, Not a Financing Problem

The usual framing of SME cash flow is financing. Get a working capital loan, extend a credit line, factor the receivable. Each of these is a response to the gap between invoice and settlement. None of them closes the gap. They price it.

The gap itself is created by the rails. An invoice is issued. The buyer pays. The money arrives at the supplier’s account anywhere from two to thirty days later, depending on the payment method, the country, the time of day, and the acquirer’s settlement schedule. For a merchant whose margins are single-digit percentages, this gap is not a technicality. It is the reason the bank-financing questionnaire is on the desk in the first place.

Account-to-account payment networks settle in seconds. Money leaves the buyer’s account and arrives at the merchant’s account in the same transaction, with no intermediary holding funds, no batch files, no reconciliation window. That is not a financing product. It is the absence of a gap.

What payware Does

payware is the resolution layer that banks and payment institutions query on every transaction. The institution holds the customer account and authenticates the customer. payware returns the merchant name, amount, currency, and merchant bank account. The institution executes the transfer.

There is no escrow, no settlement account on the payware side, no custody of funds. The transfer is account-to-account, which means the merchant’s bank receives the payment the moment the customer’s bank releases it. For the 57.1% of SMEs waiting on receivables, this is the difference between a cash flow problem and a non-event.

The Role of Banks

Banks are the delivery channel, not the obstacle. For a bank, joining the payware network means offering SME customers instant settlement without building new payment rails, without underwriting new credit, and without changing how accounts are held. The bank’s customer relationship stays with the bank. The authentication stays with the bank. Funds move between bank accounts the bank already manages.

This is worth stating clearly because the usual A2A conversation asks banks to enable something that sounds like disintermediation. payware does not. The bank is the party that executes the transfer. The bank earns a share of the transaction fee. The bank’s SME customers receive a product the bank can offer without building it.

The Role of ISVs and POS Partners

Most SMEs do not read fintech articles. They use a POS system or an accounting package their supplier recommended. The supplier decides what payment methods are available. If the POS vendor offers payware, the SME gets instant settlement. If it does not, the SME gets card rails with two to three day settlement and 2-3% in combined fees.

For POS and ISV partners, payware is a revenue line (7-25% of the transaction fee) and a retention mechanism. SMEs that move to instant settlement do not go back.

What This Looks Like in Practice

An SME in Bulgaria’s hospitality sector, the fastest-growing SME segment in 2024 by both employment (+7.3%) and real value added (+11.9%) per the same report, takes a payment for a 200 EUR dinner.

On cards: settlement arrives on T+2 or T+3, net of approximately 2.5% in scheme and acquirer fees.

On payware: settlement arrives within seconds, net of 0.5%.

Over a year of revenue, the difference in settled cash flow is measured in weeks of working capital. The difference in fees is measured in margin. For a sector operating on single-digit margins, both matter.

The 57.1% number is what happens when this infrastructure is not available. It is not inevitable.

The Bottom Line

The IANMSP report connects the SME revenue crisis to payment discipline. The policy conversation treats that as a financing problem. The rails make it a settlement problem.

For SMEs: instant A2A settlement removes the receivables gap. No loan required.

For banks: the network is a product layer above existing rails. The bank keeps the customer, the authentication, and the fee share. It does not build payment infrastructure.

For ISV and POS partners: the same API covers every initiation method. Your SME customers see a new capability appear in a product they already use.

The invoice-to-settlement gap is not a feature of doing business. It is a feature of the rails your customer’s bank happens to use.

Want to understand what instant settlement looks like for your SME customers?

payware is the neutral A2A resolution network used by banks, payment institutions, and ISVs across the EU. Instant settlement, flat-rate fees, and a single API for every payment initiation method.

Learn more: payware.eu

About payware

payware is the neutral transaction resolution network for instant account-to-account (A2A) payments. Banks query payware to resolve transactions - receiving merchant name, amount, currency, and the optimal merchant bank account. Payment institutions retain full control of authentication, accounts, and funds movement. ISVs integrate payware to onboard merchants to the ecosystem. payware offers seven payment initiation methods - QR code, NFC, BLE, soundbite, text, link, and barcode - with flat-rate fees and instant settlement. Founded in 2019.