Last editedMar 20222 min read
Outstanding payments can be a huge inconvenience for contractors, freelancers and business owners. It can be a nightmare from a cash flow perspective, not to mention the amount of time you can end up wasting chasing up late payments.
Payment reminder letters and past due invoice letters are important steps you can take to follow up on an overdue payment. However, taking too light or relaxed a tone in your correspondence can mean you’ll be kept waiting for your already delayed payment. This is why the best approach can be writing a strong letter for outstanding payment, making it harder for customers to keep giving you the runaround.
In this post we’ll give you an outline and some tips for penning a strong letter that will garner the desired result, i.e. prompt payment.
How to write an outstanding payment letter
1. State the purpose of the letter
Begin your letter with a standard greeting, addressing the recipient by name. Then, clearly state the purpose of your letter. This can be swiftly in a sentence such as the following:
“I am writing to inform you that I have not yet received due payment from my last invoice.”
While this opening statement should remain polite and professional, getting straight to the point reflects strong intent on your part, making it harder for a customer to ignore or fail to take you seriously.
2. Detail specifics about the invoice
If your customer is dealing with a large number of invoices at one time, they may not be able to immediately identify which invoice you’re referring to. Ensure you include an invoice reference number, the date it was sent and the date the payment was due in your letter. You can also simply attach another copy of the invoice, however make sure this is sent as PDF so that it can be easily viewed.
As well as helping a customer to match your letter to their records, it also serves to confirm their lateness, and re-emphasize urgency by providing factual details they cannot deny.
3. Mention your availability to answer any questions
It can be helpful to include a small paragraph letting customers know that they can reach out if they have issues with the payment. This can encourage those in difficulty to to get into contact to help negotiate a solution, instead of simply ignoring your reminders. However, it also lets them know that you’re not going to let this drop, and you have time and energy dedicated to ensuring the receipt of this payment.
4. Include a mention of your late payment policies
If you have a late payment policy, make sure you remind the customer of it. This can help encourage them to make the payment swiftly to avoid accumulating extra charges. If you don’t have any kind of late payment clause in place, consider doing so in future as it can be a great tool for motivating clients to pay on time.
5. Adapt your tone to the level of lateness
It’s important to maintain a respectful tone when corresponding with clients in order to keep relations professional and courteous. However, if you have already sent several reminders and the payment is more than 2 weeks late, it’s recommended that you adopt a firmer tone.
6. Offer online payment options
Making payment easier and more accessible for clients can help expedite the payment process. Consider offering online payments, or widening the payment options you offer to reduce delays in payment.
With GoCardless, you can use Instant Bank Pay to make one-off, same-day payments via Paylink or sending payment request links. This makes it far easier to get paid as the customer simply needs to click the link.
We can help
GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Find out how GoCardless can help you with ad hoc payments or recurring payments.