For businesses, most important component for them to be successful is the profitable revenue. Especially when these businesses are small-scaled, even the small amount of payment due of clients can be incur losses for them and hence effect their financial activities. Thus, it is essential and very crucial for the finance and receivables management department to retain their customers despite of their past dues. This can be done by delivering professional past due notices in a subtle way so that you can convey the reminder of the payment and at the same time it does not appear rude or harsh.
If the payment due date is within a week or two, it is always better to give a reminder or a courtesy call approximately 15-7 days before that. This can be delivered via an email or a letter in a polite manner. Below are certain tips that can be followed to write the same. This might prove helpful.
Initiate with “For your convenience…” kind of phrases which sounds polite as this signifies that it is not a nagging letter rather a helpful gesture. Remember that this is the first payment due notice, thus, it is always advised to keep it polite and do not forget to include the payment options and amount due.
First Past Due Notice
The very first day when a payment is past due, you are required to send your first collection letter or email. It is very important to let the customer know about your awareness of their delinquency. By doing so, customer gets a hint to put the invoices at his/her priority list. As per the facts, it is found that majority past due payments are due to preference for longer payment terms, not malice. Hence, the first past due letter should be firm and professional yet cordial. Use of more formal language signifies your serious intention. Avoid defensiveness approach and write as “your account with us now appears as past due”.
Do not forget to include the invoice you are taking as a reference, the due date and the payment policy. The implication of first past due notice document is to bring up late fees your company may collect. It is always better to include payment options in your past due notices as this will ensure that clients act on it quickly. Further, follow up your client or payment reminder with a recording call for later reference, if needed.
60 Days Past Due Notice
When an invoice is due for past 2 to 3 months, it needs to send frequent reminders and use bold language to alert the customer. To grab quick attention of the customer, the subject line should start with the phrases that give sense of urgency and priority. It can be any from: IMPORTANT, Requires Immediate Attention, Action Needed, and so on. In case you are writing 30 days past Due Notice, be firm, specific and utmost professional to boldly write the content. Make sure that this letter is also sent to other employees.
Final Past Due Notice
For invoices up to 120 days past due, you may still get an opportunity of re-payment from clients and this time ensure that you include the consequences if they do not pay the amount due like credit rating, bad debts etc. Use bold and firm language like “Severe” and “Delinquent”. Include sending the alert messages to additional employees of the organization, and mention the repercussions of their deeds in case they fail to respond in time.
Past Due Notice Template Download
Sample Past Due Reminder Letter