B2B Collections

The Complete List of Debt Collection Terms You Should Know

Debt recovery is all about staying proactive to stay out of trouble. Before you dive into finessing your bulletproof collection strategy, let’s brush up on some of the most used terms in the biz.

A Definitive Glossary of Essential B2B Collection Terms (and Why They Matter)


A record or file of a debt, opened when you contact a recovery specialist. An account is what you’ll need to reference during the recovery process.


A debt that is unpaid or overdue. This is a legal term that will come up often.

Charge Off

Any amount of an account that you no longer expect to be paid. The money is written off as a bad debt for accounting purposes even though the debt is still owed. Note that a charge off will appear on a client’s credit report. This is a last resort option for the creditor.


The process, from the moment your invoice goes overdue, of seeking money that you are owed.


The person who is owed money (that’s you). In legal proceedings, they may be referred as the plaintiff.

Credit Report

A record of a client’s credit history, as reported by creditors and other financial bodies. If there is inaccurate information due to circumstances including identity theft, a client can dispute their credit report. Credit reports are crucial to debtors and may include details of:

  • Employment
  • Addresses
  • Credit inquiries
  • Credit cards and loans
  • Accounts
  • Liens
  • Wage garnishments


The amount of money claimed that is yet to be calculated.


The person who owes money (your client). In legal proceedings, they’re known as the defendant.


Also called defaulting on a debt. This occurs when a client fails to meet the repayment obligations on a debt, either when they miss payments or stop making payments.

Default Judgment

A court judgment that is made when someone did not file a defense and the plaintiff (creditor) obtains a judgment from the court.. In this case, the debtor will be sent a notice of default.

Delinquent Debt

An account on which a payment is past due. You can report any delinquent account to a credit bureau. Note that when an account turns delinquent, it’s possible to charge off the account.


Through a court order, you can force a debtor’s employer to withhold a portion of the debtor’s wages or bank account to pay an outstanding account.


The cost of borrowing money or buying goods or services on credit. It is typically calculated as a percentage of the amount due.


An itemized list of goods shipped or work complete, oftentimes specifying the price and the terms of sale.


The initial amount of the debt or the amount that remains unpaid by a consumer. It does not include collection fees and interest.

What’s Next?

Now that you’ve (re)familiarized yourself with the lingo and terminology, it’s time to get to work on a solid strategy. Check out our expert tips on how to devise a collection plan that works for you. If those don’t cover it and you’re still waiting to get paid, then give us a holler, day or night.

B2B Collections Collection Tips Loan Advice

The Good, The Bad, and the Ugly: Who Should You Extend Credit To?

The decisions you make at the end of the day will affect your monthly bottom line. That much is undeniable. So who you give credit to, and how much, plays a vital role in your collection strategy both today and tomorrow.

There are many reasons why over 70% of American small businesses have outstanding debt. Decision-making is definitely one of them. At Monetaria, we work with New York businesses every day. We see over and over again smart individuals choosing clients or loan tactics that go against their best interests. It’s time to change that.

In the article below, we’ll guide you through some quick and dirty collection tips that just about any small business can implement. Save time, save money, and learn how to spot clients that are way out of your comfort zone!

When you’re extending credit, ask yourself the ultimate question: How much risk can your business handle?

The answer to this question depends on a lot of different things, but your profit margin is the most important. High profit margins allow for more risk. If you’ve already taken on a lot of debt and your margins are low, stay away from riskier clients.

Got high margins?

More risk potential.

Got low margins?

Less risk potential.

Investment and investigation are like peanut butter and jelly — an irresistible combination no business can do without.

But how do you know which clients are riskier than others? Well, whenever you extend credit to a business or client, you must investigate their ability to make payments. As a general rule, we recommend that you match your investigation to the level of investment.


The Bigger the Loan, the Bigger Your (Time) Investment

As you offer more credit, you must venture deeper into the business’ financial history. But what should you investigate? Ask and you shall receive.

First, the essentials. We’re sure you already know this stuff, but we’ll offer it just in case you need a refresher. For literally any B2B commercial loan investigation, you should look into the following level one information:

Level One

  • Business name
  • Owner and Officer names
  • Address of business
  • Duration at that address
  • Phone number(s) of business

As risk climbs, so too should your research efforts. Here are the level two risk investigation categories:

Level Two

  • Credit references
  • Phone number and address of banks where business accounts are kept
  • Applicant’s accountant

Don’t Forget to Choose the Proper Tools

When conducting in-depth business investigations, it’s also important to leverage the latest research tools. In this case, we’re talking about background checks. There are dozens of suppliers out there, but the best companies to use for client background and credit checks are:

You want to choose one of the above companies because they’ll have the most up-to-date and accurate information. Quick note – the information you get should only be used pursuant to local and federal laws. Make sure you are adhering to local and federal laws about using third party companies to do background checks. 

If the business does a significant amount of credit card sales, it’s also worth asking for 2-3 months of merchant statements. You won’t be using them for anything at first, other than getting a baseline for their credit card sales. 

Later, if their payments start coming in late, you can ask for a recent merchant statement and compare the two. This is an easy way to verify that, yes, their sales are down, or they have run into a little trouble and may need more time to pay.

Summing Up

  • The higher your margins, the more risks you can take.
  • Deepen B2B investigations based on your investment.
  • Leverage credit tools such as Experian to reduce risk.
  • Ask for merchant statements to get a baseline on their sales. 

When the Good Gets Ugly, You’re Not Alone

Despite best efforts and sound decision making, every business will acquire a client that, for one reason or another, refuses to pay their debt. When that happens, stay calm and keep it professional. 

Write them a few honest and direct collection letters. If that doesn’t work, give Monetaria a call. We have over a decade of B2B and Merchant Cash Advance debt recovery experience. Above all, remember that you’re not alone — we’re here to help.

B2B Collections Collection Tips

How to Write a Collection Letter: Avoid These Common Mistakes

Running a successful business is about keeping your accounts receivable above water. When you see those relationships start to sink, the effects on your cash flow could be devastating.

So you’ll need to implement the right strategies to make sure your customers pay on time. When you do, you’ll ensure that your cash flow stays in the green and your stress levels stay low.

When customers don’t pay, you must shift your collection efforts into a new gear to recover any outstanding amounts. Collection letters are an invaluable tool you can use to get payment from customers while still preserving your relationship with them.

But where do you learn how to write a collection letter? What information should you include? When should you send it? 

At Monetaria, we live and breathe collections. Below, we’ll answer your collection letter concerns in detail. As a bonus, we’ll give you a collection letter template you can use in your efforts.  

What Is a Collection Letter?

Before we get into the details, let’s recap what a collection letter actually is. Simply put, a collection letter is a written notification that you send to a customer to inform them about their due payments.  

Typically, a collection letter may include payment reminders, inquiries, warnings, or notifications of possible legal action to be taken against a customer if they fail to pay overdue amounts promptly. Ultimately, if done right, collection letters help you to get paid while leaving the relationships with your customers intact.

What Makes a Collection Letter Effective?

Your relationship with your customer begins with effective communication. Staying honest is key. Communication typically starts by collecting the customer’s information and also providing them with a contract or conditions of sale that outlines your payment terms.

However, it may happen sometimes that customers don’t pay. And here, collection letters are another vital part of communication and a key tool that you can use to recover outstanding accounts. These letters are so so effective because they:

  • notify customers of outstanding accounts
  • demand payment from customers
  • indicate the steps required to get back on track
  • serve as notifications of the steps you’ll take if they fail to make payment

Heads up: to be effective as a tool in your collection efforts, there’s some information you need to include and mistakes to avoid.


What Information Should You Include in a Collection Letter?

Now that we’ve seen what collection letters are and why they’re effective, let’s look at the key information any effective collection letter should contain:

  • Company details. You must include your contact details on the collection letter including your address, telephone number, email address, and website if you have one. This is simply to make it easier for the customer to contact you.
  • Amount owing. You’ll have to include the exact amount owing. Ideally, you should include it in two places in the letter and it should be clearly visible.
  •  Due date. It’s important to always include the date when the balance was due to be paid.
  •  Invoice or account number. By including the account number, you’ll ensure that your customer knows exactly what account you’re referring to, so you can eliminate disputes later on. Including the account number also helps you keep track of the collection letters you’ve sent and follow up on payment.  If you have a written contract with your client, also include reference to the contract and the date it was executed. 
  • Call to action. This is one of the most important parts of the collection letter and aims to appeal to your customer to pay the outstanding amount. Here, it’s a good idea to include different methods of payment so that your customer can choose the most convenient one, which, in turn, increases the possibility that they’ll pay.
  • Thank you. Although it may sound strange to thank the customer, it goes a long way not only to increase the possibility that the customer will pay, but also shows professionalism and that you’re willing to maintain the relationship with the customer.

The Four Types of Collection Letters

The First Collection Letter

You’ll typically only send the first collection letter after you’ve tried to contact the customer by phone or email, and you couldn’t get a hold of them. In some instances, you’ll also send the first collection letter if you’ve gotten hold of the customer, but they failed to make a payment arrangement in respect of the overdue amount.

Keep in mind, though, that you should send the first collection letter no later than 14 days after the due date.

The second Collection Letter

Before you send the second collection letter, you should try to contact the customer again to find out whether they got the first collection letter and if they want to make a payment arrangement. If you can’t reach the customer or you do, but they fail to make an arrangement, it’s time to send the second collection letter.

Although the first and second collection letters convey much the same message, the main difference between the two is that you’ll make mention of the previous collection letter in the second letter.

The third Collection Letter

Once you’ve sent the second collection letter, you’ll once again try to contact the customer by phone. If you can’t get hold of them and they’ve made no attempt to contact you after the initial two letters, you should send the third collection letter.

 Like the second collection letter, you’ll refer to the first two letters and the fact that all attempts to recover the outstanding balance from the customer have been unsuccessful. Here, it’s also advisable to send the letter by certified mail as this requires that someone sign for the letter, which gives you proof that it was received.

The fourth Collection Letter

By the time you get to the fourth collection letter, it should be clear that the customer is either unwilling or unable to pay the outstanding amount. As a result, you’ll also use the most assertive language in this letter while still remaining professional.

Like the third collection letter, you’ll state that previous letters have been sent and all attempts to collect the outstanding amount have been unsuccessful. Likewise, you’ll also send this letter by certified mail to ensure that you get proof that it was delivered and received.

Common Mistakes To Avoid

Remember, the ultimate goal with the series of collection letters is to recover any outstanding amounts from a customer while maintaining a good relationship. Although you now have some guidelines as to what information to include and when you should send the letters, there are some things you shouldn’t do.

Considering the above, it’s vital that you don’t:

  • Use harsh words in the letter and rather keep it professional.
  • Harass customers for payment. Although, in some cases, customers won’t pay, it’s always best to assume that they will.
  • Send text messages to customers. It’s always better to use collection letters that are formal and professional, and which provide you with proof that they were delivered and received.
  • Communicate with customers through social media. As stated above, you want a record of the correspondence that you’ve sent to the customer and the proof that they’ve received it. With social media, this is unfortunately not very easy to keep a clean record.

Download collection letter templates

With our free template, you’ll be able to send one or more collection letters to the customer to get your cash flow back on track.

monetaria collection letters

The Bottom Line

When you want to optimize the cash flow in your business, you must implement the right strategies to ensure that your invoices and outstanding balances get paid on time, every time. 

Hopefully, this post helped illustrate what information you should include in a collection letter and when it should be sent.

To find out more about collections, our services, or to download our collection letter template, visit our website or get in touch with us for more details. Monetaria Group is a New York-based B2B collections company that helps both small and medium businesses with their B2B collections.

B2B Collections

Managing Credit Before It Becomes Bad Debt: 5 B2B Loan Rules to Live By

At the root of any business, the goal is to make a profit. Forget yoga. Cash coming in at the end of the day is crucial to personal wellbeing. What’s stopping you from seeing those positive weeks turn into profitable months is bad credit. 

As of 2020, the total US public debt surpassed $20 trillion. That’s a lot of zeros. Which is to say managing credit with customers can be tricky. This goes double if you understand their situation or have seen them hit hard times. 

Everyone knows a business that has trouble with past-due bills. The stories of how that debt accrued can be tragic. But remember, B2B credit management isn’t about feelings. It’s a set of rules that can protect you from drowning in defaults. 

In the article below, we’ll go over five simple rules that can help you manage customer credit before it turns into bad debt. With our help, you will answer the question that enters most of our clients’ minds: What are the best practices for managing B2B credit?

managing credit: monetaria's 5 rules

  1. Know Your three p's (practices, procedures, & policies)

You need to have these three Ps in hardcopy. Working with clients every day means you know most of this stuff already. Typing it out and circulating it to your employees, however, changes more than you may think. 

Your B2B loan practices, procedures, and policies safeguard you from extending credit to customers that may not be worth the effort. It also helps larger teams support one another in faster credit industries, such as merchant cash advance. 

Here are some questions your three Ps should answer:

  • What are the credit limits?
  • Where are these limits recorded?
  • How do we define credit terms?
  • What are our nonpayment actions?

  1. Clearly Define what Creditworthiness Means to You

Look, this isn’t personal or anything, but lots of businesses don’t sit down and think about who they should be giving credit to. 

You can have more policies and structures than the IRS. It doesn’t mean anything if your business extends credit to anyone that walks in the door. 

Also, we recommend reassessing customers on a routine basis. That way, you can spot the warning signs which can lead to delinquency. 

  1. Build an Authorization Chain

Every customer has their own history with your business. We don’t doubt there are some you’re more willing to give an extension when they default. But have you sat down and planned out who approves extensions?

To do that, you must establish a hierarchy. Everyone should know who signs off and who doesn’t. Authorization chains can help solve the following issues: 

  • Credit Limit Increases
  • Collection Terms and Periods
  • Payment Freezes

  1. Make Updating Creditor Info Second-Nature

We should all be on the same page by now and agree that having a clear credit limit, delivery term, and collection period is vital for every client. But as time goes on, a customer’s situation might change. 

Their business might lose monthly income. Or it could be the opposite — they could be doing better. Either way, you must make it a habit to update their information. 

Is starting to seem like a lot to keep track of? Try looking into some credit management software. The hassle and expense of getting the program up and running could be worth it in the long run.

  1. Put a B2B Collections Agency on Speed Dial

With accounts receivable, it pays to have a collections agency you can trust. Once an account turns 60 or 90 days delinquent, you’re better off sending it to the pros. Here are a few reasons why:

Keep it professional: You’re less likely to get emotions involved if you hand delinquencies to the experts.

Recover Assets Faster: Our suite of debt collection tactics means quick recovery. 

No Wasted Time: You can focus on clients that pay, and leave the others up to us.

Want Our advice? Read the Beginner’s B2B Debt Recovery Handbook

Defining creditworthiness and keeping customer files updated can keep your credit from turning into bad debt. Just remember that B2B collections aren’t something you master in a weekend. We’ve been in the business for years and we’re still learning. 

So if you want more help avoiding bad debt, don’t forget to download our handbook. We’ve packed it with strategies, checklists, and advice that has helped our clients avoid delinquencies. 

Get it for free right here.

B2B Collections Loan Advice

should sales reps handle overdue account receivables?

Cash flow is the lifeblood of most small to medium businesses and nothing puts a dent in your cash flow like your customers not paying up.

When payment comes due and the customer is nowhere to be found, there tend to be two schools of thought on who should deal with overdue account receivables.

  •     The first school of thought says that collecting on overdue accounts is the sole responsibility of your accounts receivable team or your collections department.
  •     The second school of thought says that the sales cycle isn’t technically complete until the customer has made payment, meaning your sales reps should play a part in credit control and collections.

If you’re thinking “both of those are valid points” then you understand the conundrum. At Monetaria, we understand you need your customers to make payments to ensure consistent cash flow, which means all hands to the pumps.

But, at the same time, should you be diverting your sales team away from their own responsibilities to help with collections?

This is particularly relevant to smaller businesses that may not have a dedicated collections team and using their sales reps might seem like the only option.

Today, we’ll be looking at the pros and cons of the situation and trying to answer the question, should sales reps be responsible for collecting overdue account receivables?

The pros of using sales reps in collections

  1. An existing relationship

Calling someone to ask for money is uncomfortable, regardless of context. However, having an existing relationship in place can make the whole process a lot smoother.

Your customers already know and trust your sales reps. That pre-existing relationship can counteract, to an extent, the discomfort of having to call a customer to press for payment on an outstanding invoice.

Because the customer already has a positive relationship with your sales team, it’s also harder for them to simply ignore a collections call or email. Customers generally find it much easier to ignore an unknown accounts receivable person than a sales rep with whom they already have a personal connection.

  1. It’s not a collections calls

Getting a call from a collections team sets the tone for conversation to come and can immediately put some customers on the defensive, making it harder to get a positive outcome.

However, if your sales rep is simply calling to make sure the customer is happy with their product and conduct some sales aftercare, then they have the opportunity to connect with the customer and set them at ease before gently reminding them that payment is outstanding.

Sometimes an approach that is less obviously focused on collections can yield better results.

The cons of using sales reps in collections

Unfortunately, when it comes to using sales reps as part of the collections process, there are some obvious downsides, including:

  1. Your sales team aren’t selling

The most common argument against using sales reps as part of your collections efforts is that, while they are making those collections calls, they aren’t selling.

The primary focus of your sales team should always be making sales.

Additionally, as obvious as it seems, your sales team isn’t a collections expert.

Even with training on the gentle persistence approach, they might just not have what it takes to convince the customer to make payment on an overdue account.

  1. It puts customer relationships at risk

As we’ve already mentioned, making collections calls is a difficult and uncomfortable process, especially for the customer.

Your sales team has worked hard to cultivate the relationships they’ve built with your customers and wrongly timed or toned collections calls can ruin all of that hard work.

In the customer’s mind, contact with the sales rep has now shifted from an opportunity to add value, to an uncomfortable request for funds they might not have, making future sales calls much more difficult.

For companies who are reliant on repeat business, putting the customer relationships that their sales team has carefully crafted at risk can be a real impediment to using their sales force in collections.

There’s no ‘one size fits all’ solution

As you can see, just like the original arguments for and against using your sales reps in collections, both the pros and cons are fairly convincing.

With good arguments on both sides, it can be very hard for business owners to make a call on whether to use their sales reps in collections.

The good news is that there are other options, including:

Connecting sales commissions to completed payments

By releasing the commission generated by sales only once payment has been made, businesses can encourage the sales team to have a vested interest in seeing customers make a timely payment.

Since commissions are connected to completed payments, sales teams are more likely to focus on their due diligence, vetting customers properly during onboarding, and making sure the customer fully understands your business’s payment terms.

A greater focus on completing the entire sales process, from initial contact to payment can discourage some sales teams from pushing through customers with poor payment records in order to inflate their numbers.

Having your sales team put the necessary precautions in place at the beginning of the sales process can help to prevent the collections team from needing to get involved further down the line.

Create a customer success team

As a rule, the customer success team sits in between the sales team and collections and enjoys some of the benefits of both.

They can draw on the information and relationships that your sales team has built to connect with the customer and present themselves as adding value by helping the customer get the most from your goods and services.

At the same time, futures sales aren’t contingent on those relationships, so your customer success team can be used to gently push for payment on recently overdue accounts, perhaps less than 30-days, before handing any persistently outstanding accounts over to collections.

contact the B2B debt specialists

Instead of employing your sales force to assist in your collections efforts, you can contract with commercial debt recovery specialists like Monetaria.

We specialize in B2B and Merchant Cash Advance collections and have more than a decade of experience in helping businesses collect what they’re owed.

Our expert collections teams employ custom-tailored recovery strategies based on your specific circumstances. We know there isn’t a one size fits all solution and we’re flexible enough to find the right solution for you and your business.

Contact us today to find out more about how we can help with your outstanding accounts receivables and let your sales team go back to what they do best. Selling!

B2B Collections

10 Debt Collection Tips to Keep the Cash Flowing

Getting paid on time isn’t totally out of your control. This isn’t the weather we’re talking about — it’s business. Sure, everybody runs into roadblocks with a customer or two. But what separates a steady cash flow and a dried-up channel is right there in your hands. 

At Monetaria, we know there are plenty of things you can do to make sure your customers pay on time. Ten things, in fact. 

The future of account receivables is looking up. Things are more technical now, and that’s good news. You have plenty of tools and tricks awaiting you to lower your stress levels and actually look forward to the end of the month. Here are some of the best tips to get paid on time, every time.

10 Debt Collection Hacks: The Expert’s Cheat Sheet to Always Get Paid

  1. Record, Record, Record.

If it sounds like we’re saying the same thing over and over — it’s because we are. Throughout our list, we’ll be pleading with you to document customer interactions, invoice calls, responses, and actions taken to resolve overdue receivables. So it’s worth just coming out and saying it at the top of the list: Record everything! It will help you a lot in the long run.

  1. Nip Complaints in the Bud

Most overdue payments come from customers that have an issue with your service or product. They may have mentioned something in passing, or wrote a bad review on Google. Either way, it’s important to contact them and hash it out. 

Make sure to keep documentation of the conversations you have with customers. You don’t have to go covert ops and buy a hidden mic or anything. Just write down the date and the broad details of the conversation. Whatever issues your customer has with your business, getting them resolved will always be cheaper than negotiating bad debts down the road.

  1. Reward Paying on Time

Setting up some minor incentives can have profound psychological effects on your customers. Giving them 3% or 5% off for early payment means they’ll think twice before adding your invoice to the bottom of the list. 

To spice it up a notch, you could also throw in a penalty. Letting your customers know that their overdue accounts accrue interest charges can help remind them that what isn’t paid today will only cost more tomorrow.

  1. Cut Risks with Credit Applications

For loans and high-cost invoicing, it’s worth taking the extra time to run a credit check. Both Equifax and Transunion can pull business credit reports for B2B business loans and other dealings. The money it costs will seem like peanuts compared to the stress it’ll save you knowing your customer’s financial health. 

A B2B credit report will let you know about any liens, court judgments, and delinquent accounts under the business’ name. When you know that your prospective client has been sent to collections in the last six years, it may make you rethink your decision.

  1. Invest in Airtight Contracts

Downloading free contracts off the internet, or asking a buddy’s girlfriend’s brother who used to be a paralegal to write up your customer contracts is bound to make you eat crow. The money you spend on a thorough contract will save you in the long run — we guarantee it.

  1. Double-Check Client ID

When setting up a new account, you need to do your research. Ask for a photocopy of the client’s driver’s license. Then, when you’re confirming their application or account information, compare the name, address, and date of birth. 

If anything doesn’t add up, ask your client. For example, they could’ve recently moved, and the verification saved you the headache of sending an invoice to the wrong address.

  1. Ask for a Deposit

Getting partial payment ensures a level of trust between your business and your customer. You also get to bolster your cash flow long before the account is due. It can be as simple as 30% of the invoice. For monthly payments, we suggest asking for first and last.

  1. Be Polite... but Be Heard

When a client doesn’t pay on time, it’s important that your reminders be polite and considerate. Your relationship might be under a little pressure, but most of the time, you can resolve the account on good terms. 

Make sure you update the debtor on how much is due with a collection letter. and offer some guidance on how they can resolve the account. If they are strapped for cash, there’s a good chance you aren’t the only one calling for payment. Who do you think they’ll want to pay, the person that tries to understand the situation or the one yelling their ear off?

  1. Invest in Airtight Contracts

We live in a world of computers and automation, so leverage some of that silicon and solder by setting up notifications when a payment is overdue. That way, you can cancel their monthly service or stop your crew from going to the job site. It sends the message that you’re aware of the overdue account while also not putting your finances on the line.

  1. Contact the Pros

When there’s no answer on the other end of the line, or the account goes a month or more overdue, it might be time to call in the calvary. You can submit accounts to Monetaria day or night, and we’ll get to work to get you paid.

Put an end to the past due blues

Waiting for an invoice to come in doesn’t have to feel so stressful. There are lots of things you can do to make sure your invoices are paid in full. 

Try implementing some of our professional tips, and you’ll soon see how easy it is to keep bad debts at bay. If you have questions about B2B collections or an account you’d like to resolve — we’ve got you covered. Contact us anytime.

B2B Collections

Past Due Invoice? Don’t Panic! Here are 5 Steps to Collect Your Money

Invoices are the bedrock of pretty much every business. Without them, you have no cash flow. And with zero cash in the bank, your reputation with clients and vendors quickly withers on the vine. 

That means knowing how to react when an invoice goes unpaid isn’t just a good idea — it’s vital to the welfare of your business. 

Look, most businesses will deal with at least one delinquent client during their lifespan. So don’t freak out. At Monetaria, we help businesses deal with nonpayment issues every day. In many cases, fixing the problem can be as easy as picking up the phone. 

To help you deal with MIA invoices, read our quick step-by-step guide below.

what do you do if an invoice is not paid?​

  1. Assume Your Clients Are Humans

Okay, this might sound ridiculous, but hear us out. In our experience, 99% of people want to do the right thing. So it’s totally possible that this is a simple miscommunication, and you’ll both have a good laugh about it later. 

So before you pick up the phone, ask yourself these three basic questions. 

  • Did I remember to send the invoice?
  • Did I send it to the right address?
  • Was my due date clearly legible? 

If these questions don’t resolve the issue, give your client a call.

Sometimes the client has simply forgotten about payment — they were out of town or dealing with a personal issue — and they’re willing to send it over right away. 

Once you’ve told them about the outstanding bill, set up a payment date. Make sure not to get off the call until they’ve agreed to that date — don’t settle for “it’s in the mail” or “as soon as possible.”

  1. Leverage Some Incentives and Penalties

If the new payment date arrives and you’re left empty-handed, it’s time to try a new approach. You can send emails or texts to remind your client; after all, following up and persistence is crucial to collecting your money, but sometimes you need to know when it’s time to escalate.

We recommend offering incentives for early payment and penalties for late payment. For example, you could offer two percent off their bill if they pay a week before the due date. This encourages them to send you the money long before you have to start worrying about it. 

While most clients respond well to incentives, some might need a gentle nudge to send out the check. Penalties not only motivate clients to pay, but the accrued interest can also ease your cash flow issues if you end up getting the money a few days or weeks late.

  1. Get Stern... But Not Too Stern

So you’ve called and set up some incentives and still, there’s nothing in the inbox. A written letter that lets your client know they’ve fallen behind can make a big difference. 

This isn’t about constant emails or texts, but rather a thoughtfully worded response to how their inaction affects you. After all, behind every business, there are people with lives and responsibilities. By ignoring your invoice, that client has decided to ignore you, too. 

A written letter also adds to the documentation or proof that you’ve tried everything you can to get your outstanding debt paid. If further action ends up being needed, you’ve clearly done everything you can to help them pay.

  1. Contact Your Debt Specialists

Months have passed, and you’re no closer to getting what you’re owed. Now would be the time to call in commercial debt recovery experts. 

It may seem like you’re being tough, but truthfully, it’s more about being persistent. You haven’t done anything wrong, so why should you let this debt fall between the cracks?

At Monetaria, we have more than ten years of experience negotiating with debtors and getting past their excuses and empty promises. 

From background investigations to payment plans, we’ll do whatever it takes to get you paid. That way, you can stop worrying and get back to focusing on your business.

  1. Keep Your Business Relationships Professional

No matter how frustrating nonpayment can be, you must keep your head up and stay cool. Never insult or threaten a client that refuses to pay. Your business can survive a few delinquencies, but what it cannot survive is a tarnished public image. 

You can preface any follow-up calls by asking if they’re satisfied with your services. That way, if they haven’t paid because of a gripe with one of your employees or some miscommunication, they can let you know before it escalates. 

By keeping your interactions with clients private, you’ll be in better shape to impress future professional contacts and growing your business.

Don’t Let Unpaid Invoices Stop You

We know how frustrating unpaid invoices can be. They add stress and uncertainty to your business and your relationships. But no matter what, just remember that you deserve to get paid. 

Hopefully, our simple five steps to debt recovery can help you reclaim a steady cash flow. If you need more help with your commercial collections, contact us anytime. Monetaria is on your side and ready to get your money recovered.


Ready to Recover Your Money?