The economic development unit and Protocol Credit Bureau, Be Paid Ltd and Debtworks, through its CreditBiz brand, have combined forces to help Dunedin companies "tidy up" their debtor management so invoices get paid faster.
Sixty Dunedin businesses will get 50% off the normal fee up to a maximum of $500, with the unit and the three businesses paying $250 each.
Credit and Finance Institute national president David Young, also a director of Debtworks, intends putting the initiative on the institute's meeting agenda for April 23.
"I think this is a great idea and it would be great if other councils picked up on it.
"The benefit is we know how to assist businesses in a credit crunch."
Dunedin was well served by credit control and debt-collecting companies.
The available expertise was among the best in New Zealand, he said.
One of the unseen effects of the credit crunch was related to the "velocity of circulation" theory, which measured the flow of cash in the economy.
Currently, the flow was being governed and slowed down as people held on to their money longer because of worries about the future.
"Even businesses who can afford to pay are holding on because they are nervous.
"If people take a bit longer to pay their bills, that slows down economic activity as it flows through the local economy."
According to the velocity theory, money was going through three businesses a month, Mr Young said.
The Dunedin credit management companies aimed to get it flowing through four a month to help boost the local economy.
One of the things each individual business owner could do was calculate the average time it took for their customers to pay compared with the industry norm.
If it took a small business an average of 55 days to get paid and another business in the same field took only 45 days, change was needed, he said.
Days sales outstanding (DSO) was a calculation used in many countries.
It could apply to any credit period but in New Zealand, the terms were generally monthly.
DSO worked out how many days the customers were behind in payment.
Assuming that over six months, the DSO averaged at 44, that was the company's benchmark figure they should aim to achieve or better every month, Mr Young said.
