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How to Write a Payment Reminder Letter That Actually Works

Ann Marie Smith


You want to get paid. If possible, you also want to maintain a good relationship with your customers. However, you have got bills to pay too. If your customer is not paying you for the products or services you have provided, they are the ones who are putting the relationship in jeopardy.

Any time you are dealing with a slow payer or a customer not paying their bills, it helps to start with a positive message. Maybe the invoice really did get lost in the mail or they just forgot to pay it. This gives them an easy excuse without laying on the guilt. As days pass, however, you are going to need to follow a sequence to accelerate your efforts and document the process for potential legal action.

Here is a sequence we have found that works:

  1. Payment reminder email
  2. Payment reminder phone call
  3. Payment reminder letter

Within each of these three phases, the tone and language will change slightly the more delinquent the bill gets.

Payment Reminder Email

A friendly email can serve as a reminder that it is time to pay the bill. Consider following up with a couple of additional payment reminder email contacts about a week or so apart. Keep the tone light, yet professional.

This lets them know you are aware they are past due on their account and sets the stage for the next phase.

Payment Reminder Phone Call

The next step is to make a few phone calls. Be sympathetic. They may not have seen your emails, have a legitimate reason for not making a payment, or be embarrassed about their inaction. Make it easy for them to return your call by asking if there is an issue or problem you should discuss.

If customers will not take your calls or return your calls to explain what is going on, they are likely at risk for nonpayment and you will need to take it up a notch.

Payment Reminder Letter

The initial payment reminder letter turns it into a more formal process, yet still keeps a friendly tone. Make sure to attach a copy of the invoice or bill in case they lost or misplaced it. Subsequent letters will escalate the attempt to collect and start to lay out the consequences of nonpayment.

In the first letter you should clearly:

  1. Identify the issue (past due payment)
  2. Reaffirm the legitimacy of the issue (attach an invoice, note amount, and due date)
  3. Politely ask for payment
  4. Let them know that if there is a problem or concern, they should reach out to you directly
  5. Provide a way for the customer or client to respond

If possible, give them options and make it easy for them. Make sure you are providing the mailing address in your letter and on your invoice or statement. Include the phone number where they can call and make a payment over the phone. Give them your website address if you accept online payments.

By the time you have sent some emails, made a few phone calls, and sent the first letter without a response, your radar should be on high alert. At this point, it is a good idea to pull their business credit report to see if there are underlying financial problems. You can also see whether they are falling behind with other vendors. It is easy to pull business credit reports instantly online with accredit.

Spotting these warning signs early can help you decide how you want to proceed. For example, if you see that a customer is having financial issues, you may offer to set up a payment plan. This may be the catalyst to get them to reach out.

As you sequence your payment reminder letters, make each one a little more direct and add consequences. For example, you may want to add on interest (if your agreement or contract allows you to do so). You may want to let them know you can no longer extend them additional credit.

The Final Payment Reminder Letter

Your final letter should be direct and to the point. Let them know:

  1. You have tried to collect the debt on multiple occasions.
  2. They have failed to make a payment or contact you.
  3. Give them a final deadline for payment.
  4. Let them know you will be forced to turn their account over to your attorney or collections company for action.
  5. Also, let them know that you will report their nonpayment to the credit reporting agencies.

If there is still no response, you need to stand firm and follow through. Turn their account over for collection. If you fail to do so, you are giving them a free pass, and they will likely continue to ignore any additional follow-up contacts.

How to Write a Collection Letter That Will Get Customer to Pay

For customers who are slow to pay, the threat of a collection agency getting involved is often the trigger that gets them to respond. They may still not pay, but they will at least get in touch. This may be the opening you need to discuss a partial payment or a payment plan. If you‘re able to have a conversation with your customer about the situation, you will then be able to determine the best way to proceed once you know the circumstances surrounding the non-payment. Remember, however, that you provided them with a product or service and they agreed to pay. You deserve to get paid for the work you have done.

If they still do not contact you or make a payment at this point, you can have a clear conscience that you were fair and gave them every opportunity to settle their account.

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