Chasing Late Payment With Letters & Emails
Are you looking to start chasing late payment with letters and emails?
It is something all too familiar for many businesses in the UK as the number of unpaid invoices continue to rise.
When the payment date comes and goes and you are still waiting on getting paid it can not only be frustrating but worrisome too.
Last year the number of creditors’ voluntary liquidations (CVLs) spiked 51% higher compared to 2021 meaning 19,604 companies were placed into liquidation in order to pay outstanding debts.
This is a frightening statistic highlighting the real risk to businesses who are unable to get their own invoices paid to protect their cashflow.
There is some good news though.
There are things you can control that affect how soon you are paid.
Writing your invoice email
Steps you can take to avoid late payments start with your initial invoice.
Over the years we have heard so many excuses from debtors for late payment where they have blamed the invoice.
Serial debtors and customers who will think they can get away with it will try all the tricks they can including using any error on an invoice as an excuse not to pay.
Do your due diligence. Make sure all the details are correct such as addresses, payment details, correctly itemising products/services delivered and checking your invoice and reference numbers are correct. Also make sure your VAT information is included if you are VAT registered.
A frequent mistake we see is invoices not being sent to the correct person or department, resulting in the invoice getting lost. If you do not know the best person to send your invoice to get in touch with your customer and double check. This will help your invoice get processed sooner resulting in your cash being paid quicker.
When sending an invoice always include it as a downloadable pdf file as an email attachment. Not only is this a secure way to send your invoice it also makes it very accessible for your customer, so there is no excuse for them not to receive it. Naming the pdf file is very important too, include the invoice number, payment date and the name of your company so that if the file is downloaded there is less chance of it getting lost on your customer’s device.
Your customer is likely inundated with hundreds of emails making it very easy for your invoice email to get lost. By including as much relevant information in your email subject line both you and your customer will find it much easier to find the invoice if needed. Your email subject line should include invoice number, payment date and your company’s name.
When it comes to writing your email there are some key details to include in the body of your email:
- Invoice number
- Payment date
- Your name and company
- Information on the product or service delivered
Sending a reminder on your payment date
When your payment date arrives, we recommend sending a gentle reminder that payment is due that day.
Include your company and invoice number and “payment due today” in the headline so that you customer will instantly see that the invoice needs paid that day.
You should also take this opportunity to include your payment details and attach your email again, eliminating the classic “we haven’t received your invoice” excuse. A friendly and straight to the point approach is the best course of action to take with payment reminder emails.
Chase late payment email
In the event that a payment is missed it is best to chase the payment immediately with a chase payment email. Mistakes can happen and your missed payment could be completely accidental. But there is also the chance that your customer may be intentionally avoiding payment.
You do not want to compromise your relationship with your customer as your reputation and repeat business are at stake, so it is important to always remain courteous when chasing payment. But do not forget to be straight to the point – alerting your customer that your invoice is now overdue and finding out when you can expect to receive payment.
Include the invoice number, your company name and the due date of the late invoice in the subject line of your chase email and attach your invoice as a pdf file again so that your customer doesn’t then need to dig for the original invoice when they receive your chaser email.
The first chaser email you send should include all of the information from the first email you sent with the invoice attached as well as highlighting payment is now overdue and asking when you can expect the full payment to reach you.
Often a light prompt is all it takes for an overdue invoice to be paid. However, you may need to take a firmer approach if your first chaser email is ignored, or you are stalled. A stronger payment reminder email template should be in your arsenal to call upon when needed.
Your stronger chaser email will have a greater sense of urgency and your approach will be stronger. In this email you should explain that the payment is now several days overdue and that this is now becoming a problem for your business, and again asking when you can expect payment of the full amount to be paid.
A measured and reasonable tone goes a long way, even if you are getting nowhere with late payments. Coming across as overly aggressive or rude likely won’t get you paid any quicker and you also risk damaging your reputation and your business relationship with your customer.
Chase late payment email templates
We’ve done the hard work for you with these pre-written chase payment email templates that are ready to for you to send!
1st chase payment email
We’d recommend sending this email within 1 to 2 days after the date your payment was due.
Email subject: Invoice (insert your invoice number) is now overdue
Hi (customer name),
We have yet to receive payment of (invoice balance) for invoice (invoice reference number).
This invoice was due on (invoice due date). It would be greatly appreciated if you could make payment as soon as possible and update me on the status of payment.
If there are any problems delaying payment please let me know so any issues can be rectified.
If you have any queries please don’t hesitate to ask.
2nd chase payment email
When it’s been longer than 7 days and you are still waiting for payment then we’d recommend sending a follow up email chasing payment.
Email subject: Invoice (insert your invoice number) is now overdue. Please make payment immediately
Hi (customer name),
We have still not received payment of (invoice balance) for invoice (invoice reference number). This was due on (invoice date) and we previously wrote to you on (date you sent 1st payment chaser).
Please make payment immediately as this invoice is now 14 days overdue.
If you have any queries or there are problems holding up payment please let me know as soon as possible.
Final notice email chasing payment
Your final notice, or final demand, when chasing payment must make it clear that this is your final attempt to take payment before you are left with no option but to take things further with a commercial debt recovery specialist.
Email subject: Invoice (insert your invoice number) Final Reminder – Make Payment Immediately
Hi (customer name),
Further to my previous correspondence I am contacting you again regarding the unpaid invoice (invoice number). (Invoice balance) was due to be paid by (invoice due date).
As you have not acknowledged our repeated attempts to contact you for payment we will pass your account to a collection agency to recover the outstanding amount.
We will close this case if the full outstanding balance is cleared today.
Sending late payment letters
Sending a late payment letter is very similar to sending emails. In fact, your approach, the language you use and when you send them are very much the same as the emails we covered.
Now, you may be asking what is the point in sending letters then?
When chasing late payment, you want to be as hard to ignore as you possibly can and by communicating with your customer across multiple channels it keeps you in the front of your customer’s mind and harder to avoid.
The typical business email inbox can be a very hectic place, often meaning your emails could be missed, even if you take the steps we discussed earlier in this article. As businesses receive so few letters each day compared to the number of emails, they receive there is a far lesser risk of your letter being missed.
The downside to sending letters is that they are more of an inconvenience to send compared to email so you may want to save letters for your more critical communications such as when an invoice becomes overdue.
You can use the templates above for sending your late payment letters!
Writing a warning letter chasing late payment
A warning letter is the first letter to send once an invoice is overdue. A firm but polite approach is the best approach to take and you should include:
- Your company name and address
- Your customer’s name and address
- Invoice number
- Total amount owed
- Payment date and days overdue
- Explain that payment terms have been breached
- Payment details
- Your contact information
- Ask your customer if they have any questions since this could be what’s delaying the payment.
- Include a copy of your invoice with the letter.
Writing a strong letter chasing late payment
If your first letter and emails go unanswered it is time to send a stronger letter.
Like your second chasing email the language and approach in this letter will be firmer than the first reminder letter, emphasising the urgency of payment.
Articulate that this late invoice is now a problem for you and payment needs to be made immediately otherwise the case will need to be escalated.
Again, don’t sabotage your reputation. You should always be polite when chasing payment and oftentimes a strongly worded but fair approach is all that is needed for your customer to pay you.
Getting The Professionals Involved
Late payments are increasingly becoming a problem for businesses in the UK and things have only gotten worse due to the impact on the economy in the past 12 months.
If you are struggling with late payments, we would recommend taking action before it is too late. With the current shape of the UK economy, even as we begin recovering from the pandemic, we are likely to see many corporate insolvencies over the next year. If you are owed money, take action to recover what you are owed before it is too late.
Deciding whether to outsource debt collection to a third-party is a big decision for a business to make and sometimes they can be nervous if they have not used a debt recovery partner before. If you find yourself in this position you should always go with a partner with a track record recovering commercial debt with a service you can rely on.
Reasons to consider Darcey Quigley & Co
- We operate on a no win, no fee basis.
- Cases actioned within 1 hour with 48 hour turnaround.
- 93% success rate recovering overdue invoices.
- Fees starting from just 3%.
- Recover late payment interest and compensation on your behalf with an 89% success rate recovering additional charges.
- UK & International coverage.
- Rated 5 Stars on Trustpilot.
If you are wondering when you should outsource to a commercial debt recovery company we’ve written a handy article to help you see the warning signs before it is too late.
Talk to our friendly team of commercial debt experts today by calling 01698 821 468 or schedule a call at a time that suits you.
Meet our credit management and commercial debt recovery content writer, Declan!
With a keen eye for detail and a passion for educating others, Declan is committed to creating informative and engaging content that empowers readers to get a firner grasp of their credit control to improve their cashflow.
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