A Complete Guide to Payment Reminders for Your Business

Dec 06, 2021
Payment Reminders

I know how you feel. It’s an icky part when you have to remind a customer about something, especially payments. Did you know that according to statistics, over 49.6% of invoices are overdue? So businesses and brands need to help customers with a payment reminder to ensure that everything gets settled.

Now, I know I’m not starting with good news, but paying is a cycle. Let’s have a look at payment cycle stats:

  • 21% of invoices paid on the first follow up
  • 20% paid after a second reminder
  • 32% paid after the third reminder
  • 13% paid on the fourth reminder
  • 10% paid on the fifth reminder
  • 3% paid on the sixth reminder
  • 0.5% paid after a demand letter
  • 0.5% collected via professional debt collectors

You know, how with real estate, the motto is Location, Location, Location. Well, for payments, it should be Reminders, Reminders, Reminders.

All the jokes aside, it can be time-consuming and quite a bit of a hassle for businesses to manage these processes. But, it can be very manageable once you know what you are dealing with and set a process personalized for your business’s needs.

What is a Payment Reminder?

First thing’s first.

A payment reminder is an information in the form of a letter, an email, a document, or any sort that businesses send to customers to prompt them to pay for an overdue invoice.

The reminders help the customers pay for the amount they owe to the company as the cycles above show that this process isn’t, unfortunately, a one-time one.

Here comes the good news. There is invoicing software that businesses can use to automate these processes, so you don’t need to worry about spending extra time.

Besides, the most crucial trait of the payment reminders is that they provide a more friendly tone. So, you can rest assured that you won’t offend or set off guard the customer.

What is a Bill Reminder?

Businesses use bill reminders to send outstanding balances to customers and bill recipients to remind them about the payment.

And, here’s the kicker, it’s a dream-come-true for customers, since if you don’t make the payment on time, you will have to pay an overdue fee additionally. Any customer will appreciate the brand, which reminds them on time and saves them from overpaying. Now, here’s the kicker on top of the regular kicker- you can automate bill reminders!

There are dozens of bill reminder apps that both businesses and customers can use to set reminders. There’s just something about a post-it note on the fridge that just doesn’t work anymore. So, let’s have a look at a few apps:

  • Bills Monitor
  • Wallet
  • Bills Manager and Reminder
  • Monefy
  • Easybills
  • Mobills
  • TimelyBills
  • Prism Bills
  • Pocket Expense
  • Evernote
  • Money Lover
  • Spending Tracker
  • Due

What is a Reminder Invoice?

Invoice Reminders help customers know when they miss paying an invoice by the due date. Businesses use reminder invoices when the due date is about to approach and send to primary contacts or any additional recipients via emails or notifications defending what system they are using.

When? The Ultimate Question

Timing is of the essence in every subject. When the issue is payment reminders the timing becomes of ultimate essence.

Businesses need a plan in place to send reminders at the right time. For instance, you can send a payment reminder within a few days before the invoice becomes overdue to give the customers a chance to set their affairs straight and make the payment in time.

Even though most businesses can set their terms for payments and demand a payment in advance. It can’t be the case with every single business. Some of the term options can include:

  • A payment request within 30 days upon receipt of invoice.
  • A payment request immediately after sending the invoice.
  • Use of Net 30 or Net 45 gives the customers more time to make payments.

If a payment is due after the first reminder, consider sending the second or third reminder before proceeding to mediation or statutory demand. This is due to the payment statistics mentioned above.

Channels to Send Payment Reminder

Thankfully, there are many channels that businesses can send payment reminders.

The most common one is via email, but you can also send a short friendly text message. Mostly, it’s a matter of the content, not the channel.

Since the customer has already made a process and acquired your services, then you already have enough information to determine what channel the particular client will want to be contacted with. So to determine whether, via email or SMS, it should be already easy at this point.

The first reminder cycle is a gentle and a friendly-nudge to the customer about the due payment. The case should be so with the other cycles as well. It’s best to go over a checklist, per se, of what the payment reminder content should include.

Reason

Inform the customer why you contacted them and clearly state your message about the due payment on time. Clearly state that it’s a payment reminder and that the invoices are outstanding.

Invoice

Mention clearly which invoice you are referring to. Include a CTA if that’s the case and most certainly specify the amount and the due date. Repetition and consistency are key.

Payment Terms

Remember when we were discussing how each business has a different term for payments. So, let the clients know about yours and include the defined terms in your message.

Overdue Issues

Inform the customer what consequences can and will occur if the payment goes unpaid. This way, the client will be more inclined to make the bill on time.

Friendly Attitude

No matter how uncomfortable it is for businesses, you should still keep a positive and friendly note with all the reminder messages. Ensure not to send out warnings and simply give a friendly nudge and smiley reminder about the due payment. It sometimes happens to the most responsible customers, so be cheerful and just smile.

Follow the Rules

There are specific legal rules for the reminder content in place for businesses to follow up on. These rules depend on the country the companies operate in and with, so research before writing the content for the reminder.

Language

Personalize each content for each client, and this includes the language as well. Use the same language that the client initially contacted you with, so you can enhance your chances that they will read and understand the email sooner.

Payment Reminder Emails

Now, let’s have a look at overdue payment reminder emails. The critical point to remember is to send friendly and polite reminders- kind of like a nice nudge. You can go over the checklist above to ensure that no point is missing before sending out an overdue payment reminder email to your clients.

However, if after a month, you still haven’t received the payment, you will need to substitute the emails with phone calls.

The best way is to make all the efforts possible on your side to avoid late payments in the first place.

  1. One of the options is to notify about the payment terms right from the start.
  2. Some businesses offer discounts for early payments.

Payment Reminder Messages

We’re starting with good news here.

90% of all text messages are read within 3 minutes, and the average email open rate is 24%. If you are in a position where you have to select whether to contact clients via email or SMS for overdue payment reminders, I’d go with the text message.

Furthermore, statistics show that half of all consumers prefer texting as a method of communication with businesses.

All you have to do is make sure to follow the compliances and regulations. Just because the consumer is your client and has made a purchase from you, it doesn’t mean that you can bombard them with messages relentlessly. As your clients, they did opt-in already, but to spam them is a wrong move. The Telephone Consumer Protection Act (TCPA) regulation protects the customer and also states that businesses need to send content that is concise, understandable, and straightforward.

Payment Reminder Message Samples

The content, the information, and the tone of voice differ with each cycle.

Let’s have a look at a few payment reminder samples:

  • Scheduled

Send scheduled payment reminder text messages to increase the probability of a timely payment. It’s a great notion to give a few days to the clients to send their affairs straight and make a payment on time.

“Hello, Jane Doe,

We’d like to remind you that the payment of $X for XX will be due by XX.XX.XXX.

For more information, please follow the link below/please visit our site/please contact us.“

  • Outstanding

This is the part where the tone of voice needs to be harsh but also delicate at the same time. You can inform the clients about the upcoming issues if they fail to make the payment.

“Hello, Jane Doe,

We’ve tried to reach you about the due payment. Unfortunately, we haven’t received it. Should your payment fail to arrive, we will need to pursue legal action.“

  • Final Notice

I don’t know about you guys, but this is the part for me when it all gets serious. You have made attempts to collect what’s rightfully yours as you’ve provided a service for it. At this stage, the business informs the client that they are pursuing legal action, so it’s a form of FYI.

“Hello John Doe,

We have yet to receive payment after several attempts. As a result, we are now forced to take legal action. You can contact us at XXX for more information.“

Past Due Invoice Template

Payment reminder templates will make your job easier. However, they aren’t mandatory structures for businesses to follow. You can have your own company-specific or industry-specific templates to use.

There is no one-size-fits-all when it comes to past-due invoice templates. It’s more about inputting the right content and sending it at the right time. Here are tips to consider including in your template:

  1. Follow up at the right time
  2. Include all invoice details
  3. Include all contact information
  4. Be straightforward and precise with the content
  5. Be polite and friendly
  6. Automate the reminders for your ease

The past-due invoice reminders can also be divided into cycles. Each cycle will remind the clients that you will turn their account over to the collection agency over a certain period of days (cycles), should they fail to make the payment.

Let’s go over them:

  • Due for 1-15 days

Be polite and friendly for slightly overdue invoices, and you can even mention “for your convenience” in the text. At this cycle, you are friendly, reminding the client that the payment is overdue and they should proceed with the matter.

Always and always attach the invoice, the payable amount, and referrable links.

“Hello Jane Doe,

This is a friendly reminder that your payment of order XXX is now overdue. The invoice is re-attached for your reference.

As mentioned prior, here are the terms of the late payments (XXX).

We appreciate your understanding in this matter.

You can contact us for further questions.“

  • Due for 30-60 days

Be polite and friendly, but add a solid and firm tone to the content to accelerate the urgency of the due payment. You can include the words like “Urgent”, “Urgent Action Required”, “Immediate Attention” not only in the body of the content but in the subject line as well.

“Hello John Doe,

We’d like to direct your immediate attention to your invoice #XXX of order XXX that is now over 30 days/60days overdue.

We sent you a past-due notice on XX.XX.XXXX and received no reply.

Please make payment as soon as possible. We are re-attaching the past-due invoice.“

  • Due for 90+ days

If it’s been over 90 days already that the client hasn’t made the payment, chances are they will be less likely to pay at all. Now, you can turn in the invoice to the collection agency.

“Hello John Doe,

We require your urgent attention to the matter at hand. We contacted you several times on XX.XX.XXX about your overdue invoice and the terms, but have yet to receive a response or payment on your end.

Please make payment within X business days. Should the payment fail to be made, we will immediately refer your account to a collection agency.“

Past Due Invoices Email Sample

Now, let’s check out a few additional past-due invoice email samples that you can use. The examples above indicate the cycles as well.

Here are a few generic samples that you can review and determine the best way to go in your case

  • Overdue payment reminder email sample

“Hello Jane Doe,

XXX from XXX here.

We hope you are doing well and satisfied with the product/service XXX.

This email is a friendly reminder about the overdue payment in the amount of $X that was due on XX.XX.XXXX.

We’ve re-attached the invoice for further reference.

We would appreciate a response confirming that you have received the invoice and confirmation of the payment.

Should you have any questions, please contact us.

Thank you“

  • Payment follow-up email sample

“Hello Jane Doe,

XXX from XXX here.

We hope you are doing well and satisfied with the product/service XXX.

We have yet to receive a payment on your end regarding the invoice (re-attached for your reference).

This is a friendly follow-up about the overdue payment of XX.XX.XXXX.

The invoice is XX days overdue and, due to the terms and conditions, will be subject to an additional X% fee to be added to the original price.

You can see the invoice re-attached for your reference. Please make payment and provide us with the confirmation.

Should you have any questions, please contact us.

Thank you“

  • Due date reminder email sample

“Hello Jane Doe,

XXX from XXX here.

We’d like to inform you about the invoice for XXX product/services acquired on XX.XX.XXXX.

Please be reminded that the due date for the payment is XX.XX.XXXX. The invoice is attached for your reference.

Should you have any questions, don’t hesitate to contact us.

Thank you“

Payment reminder email samples are many, and the good thing is that you can write them in any form. Take a moment to consider how to write it for your businesses and your clientele.

Payment Reminder Text Message Samples

A friendly payment reminder SMS sample depends on a few important factors, including the channel of communication. Some of the options to consider include:

Text message sample #1

“Hey Jane,

Your scheduled payment will be due on XX.XX.XXXX. Here’s a link below, where you can find your invoice.

XXX“

Text message sample #2

“Hey Jane,

Here’s a follow-up reminder about your overdue payment for invoice XXX. You can find the invoice in the link below.

XXX“

Text message sample #3

“Hey John,

A friendly reminder that you are XX days overdue for the invoice. Kindly, visit the link below for the invoice. Should you have questions, don’t hesitate to contact us.“

How to send a friendly reminder for payment?

Writing a friendly reminder for payment can be a bit difficult at first, especially when it’s not your first one to write. You can feel angry and frustrated on the inside, and it’s more than ok. But don’t pass it on to the content.

A friendly reminder payment due is a notion of informing the client to make the payment and needs to be repeated in several cases with some clients. Follow the checklist below to help you to write a friendly payment reminder.

  • You’re Not Alone

You’re not alone in this, as it’s, unfortunately, a common thing to fall behind and forget on payments. So, how uncomfortable it may be, you still have to go through the process, so take a breath.

  • Polite Intro

Ease into the introduction and ensure you come off as friendly and polite. Personalize your message to give an individual approach to the client.

  • Early Reminder

It’s best to send a payment reminder a few business days before the due date, which will help you be more authentic on politeness and friendliness.

  • Thank You

The word thank you can be powerful. Don’t overdo it so as not to seem fake. But genuinely thank the client, so they take the matters into importance.

  • Chance

Send more than two reminders before taking drastic action and inform the client beforehand that you have no choice but to take drastic action if the already overdue payment remains unpaid.

How to attach an invoice to a reminder text message?

The process can be pretty easy with Dexatel. The characteristics depend on the channel of the text message that businesses communicate with customers.

SMS, for instance, has protocols in place that don’t allow sending attachments.

So, if you are sending SMS, you can send the invoice as a link and add an automated SMS reminder to send directly to the client.

The automated setup is an easy step to make that each business can do so, even for a group of clients or selecting them one by one.

For instance, RCS can include an attachment so businesses can send the invoice itself to the clients, but there are slight issues with RCS on its own. Since it only functions on android devices and is available only in 9 countries, it can’t be the go-to channel for businesses.

Other text messaging channels like Viber, WhatsApp, Telegram, FB Messenger, and Instagram all do support attachments.

Businesses can attach the invoice and send it as an attachment. Just make sure that the given channel you selected is used by the client. Otherwise, it’s much better to send a link that the client can see and download, then send an attachment that the client may or may not see.

SMS to this day is the highest with an open rate, so be sure to take advantage.

In Conclusion

No matter what the case is with payment reminders, always know that the customer should reimburse you for your hard work and services. So, diligently track the payments, send reminders as you are here to do business and make it grow.

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