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Key Takeaways
- A past due invoice is a bill for goods or services that remains unpaid beyond its due date.
- When dealing with past due invoices, emails play a crucial role.
- A well-crafted past due invoice email should contain the invoice number, due date, payment amount, and clear payment instructions.
Introduction
Running a business involves juggling many responsibilities, and managing unpaid invoices is one of the most common challenges. When not addressed properly, past due invoices can disrupt financial stability, strain resources, and damage client relationships.
That’s where a well-crafted past due invoice email comes in.
It’s not just about sending a reminder; it’s about communicating clearly and effectively. A good email should briefly outline the unpaid amount, specify how overdue it is, and provide straightforward payment instructions. This approach helps your client understand the urgency, making it easier to secure payment and maintain healthy business relationships.
In this article, you’ll learn how to craft courteous emails to remind customers of past due invoices. We’ll also provide examples and templates to help you manage this situation professionally and preserve strong client relationships.
What Is a Past Due Invoice Email?
A past due invoice email is a notification sent to a recipient to inform them that their payment is overdue. This email is typically sent by businesses or service providers to clients or customers who have not settled their invoices by the agreed-upon due date.
When an invoice becomes past due, it means the payment timeframe has expired, and the sum remains unpaid. In such cases, a past due invoice email helps businesses follow up with customers regarding the payment status.
For businesses, it is important to approach such situations with professionalism and caution. This helps them secure timely payments against the invoice while retaining valuable customers.
How to Write a Past Due Invoice Email?
Writing a past due email that helps you get paid requires following specific steps. To effectively compose a past due invoice email and reduce bad debts, consider the following steps:
1. Include the invoice number in the subject line
Grab your client’s attention right from the start by making the subject line of your email directly reference the invoice. Incorporate your company name along with the invoice number, which not only provides context but also reminds the client of the pending payment.
A well-crafted subject line can significantly increase the chances of your email being opened.
Some effective subject lines in overdue invoice templates may include:
[Company name – Invoice Number] Regarding an overdue payment
[Company name – Invoice Number] Is a month overdue
[Company name – Invoice Number] Payment required
2. Specify the due date and the amount
Transparency is key when communicating about overdue invoices. Clearly state the invoice due date and the precise amount owed in your email. Use formatting techniques like bolding and spacing to make these details stand out.
Ensure that the information matches the client’s records and previous communications. This clarity helps eliminate any ambiguity and sets clear expectations.
3. Explain payment options
Make it easy for your client to take action by providing clear instructions on how to make the payment. Include a prominent call to action and, if possible, an online payment link that allows them to enter their banking or card details swiftly.
Alternatively, provide the address where they can send a check or money order if that’s their preferred method of payment. The objective is to offer a hassle-free way for clients to settle their dues promptly, reducing the need for further reminders.
4. Specify next steps
In cases where clients ignore your communications, it’s essential to outline the next steps clearly in the past due invoices email.
If applicable, explain your late fee policy and detail the consequences of continued non-payment. This information may motivate clients to prioritize clearing their outstanding balances.
Some examples of consequences for non-payment include:
- Placing the account in bad status
- Applying additional fees
- Taking legal action in extreme circumstances
- While maintaining professionalism, make it evident that non-payment has implications and prompt action is in their best interest.
By following these steps, you can craft an effective collection email for past due invoices that not only remind clients of their financial obligations but also provide them with a straightforward path to resolution.
Now, let’s take this a step further and explore pre-designed past due notice email templates that can simplify the process and save you time in your collections efforts.
Past Due Invoice Email Templates
The below past due email templates are designed to help you communicate effectively while maintaining the integrity of your client relationships.
1. Past Due Invoice Email Template (Day 15): Two Weeks Late
If payment hasn’t been received by the due date, it’s a good practice to reach out and confirm whether the invoice has been received on their end. In cases where invoices are only a few days overdue, consider sending a friendly and gentle reminder. Often, this simple nudge is all it takes to prompt payment.
Sample email for 15-days late invoice
Subject line: [Your Company Name]: Invoice #XXXXX for [Product/Service] is 15 days past due
Dear [Customer’s Name],
I trust this message finds you in good health.
I am writing to bring to your attention the status of Invoice #XXXXX, dated [sent date], with a total amount due of [invoice amount], which is now 15 days past due.
For your convenience, I have attached the invoice [reference number] to this email. To facilitate a smooth payment process, please consider submitting your payment using the [explanation of payment method].
Ensuring that you have received the invoice and addressing any potential questions or concerns is essential to us. If you require clarification on any aspect of the invoice or face any challenges, please do not hesitate to reach out. Your satisfaction is our priority.
We kindly request that you confirm the payment status promptly. Your timely action will greatly assist in resolving this matter.
Thank you for your attention to this, [Customer’s Name]. Your prompt payment is greatly appreciated.
Warm regards,
[Your Name]
[Your Company Name]
2. Past Due Invoice Email Template (Day 30): One Month Late
When a payment is one month overdue, it’s prudent to follow up, especially if your initial reminder hasn’t yielded a response. Politely calling the customer to confirm receipt of the invoice and addressing any potential questions can be a proactive step.
In many cases, it’s possible that the invoice was overlooked or misplaced. Don’t hesitate to inquire about its status.
If you’ve already engaged with the client and the payment remains outstanding, consider reissuing the invoice, incorporating any additional charges if applicable. However, exercise caution with late payment fees; apply them only if both parties have previously agreed to such terms. Unexpected late fees can potentially create friction with customers.
Sample email for 30-days late invoice
Subject line: [Your Company Name]: Invoice #XXXXX for [Product/Service] is 30 days past due – Payment is required
Dear [Customer Name],
I have contacted you before requesting a past due invoice payment for Invoice #XXXXX, but I haven’t heard anything from you.
We are genuinely concerned and want to ensure there are no issues on your end that may be hindering the payment process. If there are any challenges you’re facing or if you require additional information to facilitate the payment, please don’t hesitate to reach out. We are here to assist you.
As of today, Invoice #XXXXX is now 30 days overdue, and, in accordance with our terms, a late fee of [amount] has been applied to your account. To bring your account up to date, we kindly request that you submit your payment at your earliest convenience. You can conveniently make a payment by following this [payment options] link.
If you have any questions or need to discuss your account, please reach out to me at [Contact Number].
Regards,
[Your Name]
[Your Company Name]
3. Past Due Invoice Email Template (Day 60): Two Months Late
When a payment remains overdue for 60 days or more, it can strain customer relations significantly. It’s crucial to escalate your approach at this point by sending a more assertive email and initiating follow-up phone calls.
This email should be:
– Assertive (Conveying the urgency of the issue)
– Urgent (Emphasizing the need for immediate action)
– Flexible (Open to discussing payment plans if necessary)
Sample email for 60-days late invoice
Subject line: [Your Company Name]: Invoice #XXXXX for [Product/Service] is 60 days past due: Need Urgent Payment!!
Hi [Customer’s Name],
This email serves as an urgent reminder that your invoice, #XXXXX, is now 60 days past due, and I need your prompt attention.
Our records indicate that the payment of [invoice amount], originally due on [due date], remains outstanding. Regrettably, a late fee of [amount] has been applied to your account as the invoice has entered its second month of delinquency.
As of today, the total outstanding balance, including late fees, stands at [invoice amount plus late fees, if applicable]. For your convenience, we have attached a copy of the invoice to this email. You may promptly settle this amount by following this [link to online payment or other payment methods].
Please ignore this notice if your payment has already been sent. Contact me at [contact number] if you have any queries, or doubts, or would like to talk about your alternatives for a payment schedule.
Time is of the essence in resolving this matter, [Customer’s Name]. I’d appreciate it if you could get back to me as soon as you can so we can resolve this.
Thank you for your cooperation.
[Your Name]
[Your Company Name]
4. Past Due Invoice Email Template (Day 90): Three Months Late
In this critical situation, genuine concerns exist regarding the outstanding payment. Deliver a final notice that unequivocally outlines your course of action for addressing past due payments. The gravity of the situation should be reflected in:
– A formal tone that underscores the seriousness of the issue.
– Clarity in articulating the next steps, including the possibility of involving a collection agency or taking legal action.
– Conciseness, with a focus on brevity and clarity to convey the message succinctly.
Sample email for 90-days late invoice
Subject line: [Your Business Name]: Invoice #XXXXX for [Product/Service] is 90 days PAST DUE – Please send payment right away.
Hi [Customer’s Name],
Please pay close attention to this important message. There have been several occasions when I have contacted you regarding a payment that has been overdue for 90 days.
Under my payment terms, you may be subject to additional [late fees or interest] if your payment is received more than [number of days] after the due date.
The final deadline for your payment is approaching. If we do not receive your payment by [final date], we will have no choice but to escalate this matter to a collection agency. We genuinely hope to avoid such a course of action and believe that a timely resolution is in the best interest of all parties involved.
Again, if you have any questions or concerns about this payment, please contact me at [contact number]. I hope we can settle this matter as soon as possible.
Your immediate attention to this matter is crucial, [Customer’s Name]. We appreciate your prompt response and cooperation in resolving this long-standing issue.
Kind regards,
[Your Name]
[Your Company Name]
5. The final escalation email for past due recovery
After months of persistent reminders and follow-ups, you may find yourself in a position where further action is necessary. If an invoice remains unpaid three months after its due date, it often indicates that your usual collection methods have been exhausted. At this stage, it may be time to escalate the matter significantly.
Sample email for final escalation
Subject line: [Your Business Name]: Invoice #XXXXX for [Product/Service] is PAST DUE – Final notice- Needs immediate action.
Hi [Customer’s Name],
Despite our previous reminders, the invoice remains unpaid and is now [Number of Days] days overdue. As per our terms, additional [late fees/interest] apply if payment is delayed beyond [number of days] past the due date.
Please be advised that if this account is not settled within seven days from the date of this email, we will have no choice but to close your account and refer it to a collections agency. This action is necessary to recover the overdue amount and may impact your credit standing. We would prefer to resolve this directly and avoid such measures.
Please contact me at [contact number] if you have any questions or need to discuss this further. We hope for a swift resolution to this matter.
Thank you for your prompt attention.
Kind regards,
[Your Name]
[Your Company Name]
Best Practices for Writing a Past Due Invoice Email
When composing a past due invoice reminder, it’s crucial to adhere to best practices that ensure clear communication and encourage prompt resolution. These are as follows:
- Start early: Initiate contact with your client as soon as the invoice becomes overdue. Proactivity helps ensure that payments are not forgotten and encourages timely settlement.
- Be transparent and clear: When drafting a late payment email, make sure to clearly communicate the originally agreed-upon payment deadlines. Establishing clear expectations from the outset can help prevent misunderstandings down the road.
- Verify contact details: Before sharing any financial information, double-check that you have accurate client information, including their email address. Ensuring you’re reaching the correct recipient is vital for effective communication.
- Include key information: In your email, include all key details related to the past due invoice. This should encompass invoice date, invoice number, past due amount, payment terms and any applicable late fees, and contact information.
- Attach a copy of the invoice: A best practice is to attach a copy of the original invoice with each overdue payment reminder email. This simplifies the process for the client to review details and verify the information in your message.
- Be consistent: Sending a single email reminder sporadically is unlikely to yield results. Create an email flow with multiple contact points and follow-ups. Weekly reminders can be a helpful starting point.
- Try other contacts: Sometimes, the person you are initially in contact with may not be responsive or available. Don’t hesitate to explore other contacts within the client’s organization to ensure your messages are received and acknowledged.
- Mention legal action when necessary: While not ideal, mentioning the possibility of legal action can sometimes expedite resolution. Consult with legal counsel or consider sending a formal warning letter, especially in cases that warrant escalation.
Tips to Optimize Your Past Due Invoice Management
Effective management of past due invoices presents a significant challenge for businesses in various industries. Even with dedicated collections teams, the intricacies of handling overdue payments can be daunting. Here are some tips to help you better manage your overdue invoices and prevent cash flow problems.
Set clear credit terms
Often, unpaid invoices arise from unclear credit terms. You must ensure that your credit terms are straightforward and explicitly stated in contracts. Clearly define payment deadlines, any applicable late fees, and discounts for early payment. Transparent credit terms help prevent misunderstandings and ensure both parties are on the same page regarding payment expectations.
Implement a structured follow-up process
A structured follow-up process is key to managing overdue invoices. Start with a friendly past due invoice reminder soon after the due date, and senda payment follow up email with more urgent reminders if needed. Develop a clear escalation path, including formal notices or potential legal action, for invoices that remain unpaid.
Leverage automation
Automation can streamline your invoice management process. By using collections automation software, you can automatically send past due notices by analyzing customer responses and generating follow-up tasks. Additionally, it allows you to monitor email delivery, open, and action rates to act on unopened or unaddressed emails, reducing a lot of repetitive tasks and enhancing efficiency.
Conclusion
No matter how well you manage your credit sales, past-due invoices are always a possibility. In such cases, sending an overdue invoice email can be a powerful tool for accelerating collections.
To further streamline this process, businesses can turn to collection automation solutions. HighRadius, for example, offers AI-based collections software designed to simplify and enhance the collections process. Our advanced worklist prioritization, streamlined workflows, and automated dunning capabilities help businesses recover payments faster and reduce Days Sales Outstanding (DSO). This results in a more efficient and effective collection process, benefiting businesses and their valued clients.
FAQs
1. What is a past due vs. overdue invoice?
A past due invoice and an overdue invoice refer to the same thing: an invoice that has not been paid by its due date. “Past due” often refers to a general state, while “overdue” is more specific. They both indicate that a payment is late and needs to be addressed promptly.
2. What is considered a past due bill?
A past due bill is one that has not been paid by the specified due date, making it overdue. Typically, it’s considered past due as soon as the due date passes. It signifies that the payment is and should be settled as soon as possible to avoid any further consequences or late fees.
3. How long can an invoice be overdue?
The duration for which an invoice can be overdue depends on the terms and agreements between the parties involved, which may range from 15 to 90 days or even longer in some cases. Usually, invoices are considered overdue if payment is not received by the due date specified in the invoice terms.
4. How do you politely say the invoice is overdue?
By sending a friendly reminder, you can politely inform someone that their invoice is overdue. Say something like, “I wanted to kindly remind you that the invoice for [product/service] dated [invoice date] is now past its due date. We would greatly appreciate your prompt attention to this matter.”
5. How do you work late fees on an invoice?
To work late fees on an invoice, you can include a clear statement in your payment terms or at the bottom. For example, “A late fee of [amount or percentage] will be applied for payments received after the due date.” This notifies clients of the late fee policy and encourages timely payments.
