How to write Past Due Invoice Emails that Will Get you Paid
Apr 13, 2022
The longer an invoice remains unpaid, the more likely it is to never be paid. That’s why A/R collection is so important - especially for small businesses that are more prone to suffer from a low cash flow.
It can therefore become a race against the clock to collect the money you’re owed once the due date has passed.
Past-due collection emails inform your clients simply and efficiently of the unpaid invoices they have with you. They also contain the relevant information for your clients to pay you straight away. While these payment reminder emails are essential, they can also be tricky to get right:
How do you get the tone right?
What should your past due invoice emails include?
What overall overdue invoice email strategy should you adopt?
Keep reading to find out the answer to these questions, as well as templates you can use for your past due invoice emails.
If you like this, you'll love Upflow, our A/R collection tool! We streamline your collection process with automated and customizable emails, so getting paid gets easier.
What Strategy Should You Adopt After Your Invoice Due Date
You’ve sent your invoice to your client (and maybe even a reminder before their due date) and then… nothing. The best thing you can do about unpaid invoices is to be proactive. Leaving it up to chance or later usually makes the matter worse, as it might slip from everybody’s mind.
Chances are your client either didn’t receive the invoice, forgot to pay you, or didn’t have the fund to do so. If you have a subscription-based business, you can nudge them so they automate their payment to avoid this situation.
Regardless of the reason, it is up to you to remind them of the money they owe you. That’s when overdue email reminders come into play.
Having trouble setting-up an effective strategy? Download our free templates.
When Should You Send Overdue Emails?
We recommend contacting your client as soon as you realize you have past due invoices, and follow up from there. Ideally, you’ll start from a week overdue and contact them every week after that.
Depending on the situation, this level of contact might seem like a lot - go with what seems relevant based on the situation.
You might want to assert your terms straight away with new clients, and give a bit more flexibility to your older clients.
If you have clients who regularly have overdue invoice payments, you might want to set up a specific email reminder workflow (as in, sequence of emails) for them. Automating this part of your account receivable collection process means peace of mind, a lower late payment rate, and more time to focus on other accounts that need your attention.
Ultimately, if you make payment reminders a priority in your A/R collection process, it will become one for your clients’ too. It’s much harder to ignore someone who’s proactive and contacts you every week than someone who half-heartedly sends follow-ups every other month.
How to Escalate Your Overdue Emails?
As you try (and fail) to get an overdue payment, you can increase the assertiveness of your tone in your communications. Of course, you have to remain polite - you don’t want your relationship to go to waste. But you also have to show them that you mean business.
Another good way to escalate your invoice reminder is to switch medium. Our CFO for example swears by a phone call, as a direct conversation with your client can settle an otherwise stuck situation. Proactive business owners are used to picking up the phone to smooth out any situation.
If phone calls and emails alike remain without an answer or action, you can send a past due reminder letter. Letters are great because they’re formal and convey the urgency of the situation. It’s a great way to get your client’s immediate attention.
At Upflow, we send letters for you, on top of automating your payment reminder emails.
What Should Your Overdue Invoice Payment Reminders Look Like
When sending payment email reminders, there are two things to pay attention to: content and tone.
What to Include In Your Late Invoice Emails.
The key to writing effective overdue payment reminders is to include elements that make them personal and effective.
Personal so your client knows it’s not a mistake and that they’re valued (they’re not just an account number).
Effective means including all the information they need to pay you. By reducing friction you make it more likely that they pay you straight away.
Here is a list of what to include in your email payment reminders:
The original invoice: with the invoice number, invoice amount due and its due date. it’s the basic information for your clients to retrace the invoice and service/product you provided. You can do so either by adding a direct link to it or attaching a copy of the invoice to your email.
The updated invoice: if you charge some late fees, you will need to issue and attach an invoice with the total amount due
Your payment methods: include a link to online payment and/or your bank account info so they know exactly how to pay you. It’s best to offer several payment options, although you don’t have to list them all in your email. You can also suggest a payment plan to your clients, as it may make it easier for them to pay you.
A personal touch: mention their name and company name so they know the invoice is addressed to them. You can also add some kind of greeting, more or less formal depending on the relationship and how many reminders you’ve already sent.
Your contact information: remember to include your name, email, and phone number so they can contact you easily if they have any questions or problems.
The next step: after the first email reminder, mention what would happen if they don’t pay by a new due date (late payment fees, restriction of service, legal action, etc.) as it adds urgency. It is also useful to include a reminder of your T&Cs.
Need more inspiration? Have a look at our free email templates.
What Tone to Use In Your Overdue Invoice Reminders.
Although you must remain civil at all times (being rude never led to great results), it is important to slightly increase the assertiveness of your communications with each of them.
For instance, you might send friendly payment reminders at first, including a warm personal opening. By follow-up number 6 though, it’s better to go straight to the point without sugar-coating it.
That being said, it’s important to get the conversation going as to why they haven’t paid their outstanding invoices. Knowing this, you can find a solution together:
If they want to raise a dispute, you can discuss it with the account executive.
If they don’t have the funds, they might be able to give you an estimate of when they will.
Facing the situation with a problem-solving attitude goes a long way. That’s why you should include your contact info and prompt them to contact you if they have any questions or problems.
Templates to Follow Up on Late Payments
Past Due Email Template for New Clients:
In the case of new customers who haven’t paid their invoice, the balance between being assertive and being friendly is even more important to get right.
You want to be assertive enough so they know they cannot get away with not paying you, but you also want to be friendly enough so they have a positive interaction with you.
Depending on your business model, a payment reminder might even be their first interaction ever with you! Either way, your relationship is just beginning, so it is more fragile.
Concretely, it means:
Reminding them of your contract and/or T&Cs in your emails to make sure that you’re on the same page.
Being personal and warm. You can even involve their Sales Executive to make sure the transition is smooth, which is what we do at Upflow.
Here is a template you can use with your new clients:
Hello (Client Name),
I hope you are enjoying (mention your product/service).
I am reaching out regarding our first invoice (invoice number) due (invoice due date). Can you confirm that you have received it?
As per our T&Cs, we require payment within (number of days).
Let me know if you have any questions regarding our payment processes.
(Your contact info)
Past Due Email Template for First-Time Late Payers.
For clients you’ve been in business with for a while however, you’ll want to assume that their first overdue payment is a mistake.
If their payment is automated, it’s likely that something went wrong, like their corporate credit card reaching a limit.
If their payment isn’t automated but could be, it would actually make sense to mention it here to save you both some time.
Either way, your reminders should be warm and emphasize the relationship you have together while prompting them gently to rectify the situation.
Here is a template you can use with first-time late payers:
Hello (Client name),
I hope you are doing well.
We have not yet received your payment for your invoice (XXX) for a total of (XXX), which was due (number of days past due) ago. You will find a copy of the invoice in question attached to this email.
You can pay now via (payment instructions).
We would appreciate a prompt payment upon receipt of this email. If you have already paid, please ignore this notice.
(Your contact info)
P.S: should you wish to automate your payment for next time, you could do so (automated payment instruction)
Past Due Email Template - 60 days past due.
If your invoice is overdue by 60 days, it’s time to take it up a notch. Assuming this isn’t your first reminder, you want to convey more assertiveness and remind them of your contract and/or T&Cs.
If you have Account Managers or Sales Executives in your business, you could ask them to check in with their contact to find out what is going on.
That’s typically when a phone call would add clarity to the situation.
Here is a template email you can use for 60-day past due payments:
Hello (Client Name),
We are contacting you as part of our outstanding invoices follow up. The invoice number (XXX) of (XXX) was due on (due date).
As per our T&Cs, we require payment (payment terms).
Can you confirm that your accounting department has recorded this invoice and give us an estimated payment date?
You will find a copy of the invoice attached to this email. To pay this invoice now, you can (payment instructions).
Please let us know if you have any questions or problems.
(Your contact info)
Past Due Email Template - 90 days overdue.
90-day late invoices deserve your full attention. In all likelihood, you have sent numerous reminders to your clients by then, and have tried to call them a few times. Since they haven’t answered and/or taken action, you should now escalate the matter further.
But before involving a collection agency or debt collector, we suggest you try sending one more email and/or a past due invoice letter.
This email reminder should summarize the actions you’ve taken in the past 3 months, as a way to highlight your good faith and proactivity. (As a side note, if you do end up taking legal action, this will be helpful to show your reasonable efforts to collect your invoice.)
That’s another reason why having an email workflow for outstanding invoices is important. By having an automated workflow for your payment reminders:
You know the previous reminders that have been sent,
There is a trace of every contact with eventual additional notes,
It’s all centralized in one space, no matter how many people are involved.
Armed with this knowledge, you can draft a final email before taking legal action (or any other measure you deem necessary).
Here is a template email you can use for 90-day overdue payments:
Dear (Sir or Madam),
We are contacting you regarding your outstanding invoices, the total of which amounts to (XXX).
We have tried to contact you on numerous occasions:
(List and dates of contacts)
Despite these reminders, your company has not paid yet the following invoices that are past due:
(List of invoices with reference numbers, amount due and due date)
You will find a copy of the aforementioned invoices attached to this email.
We, therefore, demand that you proceed to the due payment of (XXX) within (timeframe). Otherwise, we would have to take the matter in front of (the proper jurisdiction / a collection agency) and ask for compensation for our financial loss.
We look forward to hearing from you.
(Your contact info)
Do you want to automate your payment reminders for your past-due invoice? Try Upflow to have access to more email templates and streamline your accounts receivable collection process. We integrate with most invoicing software!
The longer an invoice remains unpaid, the more it is likely to never be paid. Being proactive in your A/R collection is therefore key!
Start sending past due invoice emails from a week overdue, and aim at taking one action/week from there.
Your emails’ tone should be tailored to the relationship you have with your customers. Always remain friendly, but increase your level of assertiveness over time and keep the email professional.
New clients, regularly late payers, and old clients won’t be treated the same. Have different email workflows to adapt to each target or subgroup.
Making A/R collection a priority for you makes it a priority for your clients. Being consistent in your follow-ups shows you mean business.
Automating your email reminders frees up your time, so you can focus on the accounts that deserve more attention - like the ones which are +90-day overdue.