Overdue invoice: the ladder that gets it paid without a dispute

An overdue invoice is one that has passed its due date without payment. Before treating it as a collection problem, it is worth knowing that most overdue invoices are administrative: the invoice never reached the payables inbox, it was logged against the wrong entity, it is waiting on an approval nobody chased, or it lacks a purchase order number the customer requires.

That matters because the response to an administrative problem and the response to a refusal are different, and starting with the second guarantees a worse outcome for the first. The first question is not "why won’t they pay" but "do they have a payable invoice at all".

An overdue invoice ladder that works

1. Day 1–3 after due date: a short, neutral note confirming the invoice is outstanding, with the invoice attached again and the payment details repeated.
2. Day 7: a call to accounts payable — not to your usual contact — asking whether the invoice is on their system and approved. Most problems are found here.
3. Day 14: a written reminder stating the amount, the due date, and what happens next, copied to the person who placed the order.
4. Day 30: a formal demand referencing the contract terms, with the interest and recovery costs you are entitled to charge, and a deadline.
5. Day 45–60: a decision — hold further supply, instruct a third party, or write it off. Making no decision is the expensive path.

Each step should be shorter and firmer than the last, and every one should be recorded. The record matters later: a claim, a credit insurance notification, and a write-off all depend on being able to show what was chased and when.

Interest and costs, used carefully

Many jurisdictions give a statutory right to interest on late commercial payments plus a fixed recovery cost per invoice — in the UK, a percentage above base rate and a fixed sum by invoice size. The rate and amounts change, so check the current figures rather than quoting from memory.

The judgement is when to apply it. Charging statutory interest to a long-standing customer whose payables clerk was on leave will cost more in relationship than it recovers. Reserving it for genuine delay, and saying in the day-30 letter that you are entitled to it, is usually more effective than actually invoicing it.

Stopping supply is the strongest lever most suppliers have and the one they use last, usually after the debt has grown. Check what the contract permits, give notice in writing, and be prepared to follow through — a threat that is not carried out teaches the customer exactly how much attention the account needs.

Preventing the next one

• Agree payment terms in writing before the first order, and put them on every invoice.
• Ask for the PO number and the payables email at onboarding, not at the first chase.
• Invoice on time — invoices sent late are paid late, and the delay compounds.
• Send statements monthly so that missing invoices surface before they age.
• Run a credit check on new customers taking material credit.

Because the chase depends on knowing exactly what was sent, when it was due and what has been said, the invoice and its history belong in one place. Ettex Invoices tracks the due date, the reminders sent and the payments applied against each invoice, so the ledger shows the age of the debt rather than a person remembering it — and credit control works from a list rather than from a hunch. The payment reminder email sequence runs from the same record.