How to Chase Outstanding Invoices

To chase outstanding invoices effectively, double-check the invoice for accuracy, confirm the due date, payment terms, and that it was sent to the right contact. Next, send a polite reminder email as soon as the payment is overdue, clearly restating the balance and providing a payment link. If there’s no response, follow up with a phone call to speak directly with the customer and resolve any disputes or delays. As a business owner, every delayed payment can create financial strain, slow down operations, and distract you from growth.

Review Your Records Before Reaching Out

Before contacting your customer, make sure your own records are accurate. Sometimes delays happen because of errors on your end.

• Verify that the invoice was actually sent.
• Double-check the due date.
• Confirm the payment terms agreed upon in the contract.
• Ensure that the customer received the invoice (look for delivery confirmations or system logs if using invoicing software).

Example: If an invoice was marked “net 30” but you accidentally followed up after only 20 days, you risk appearing unprofessional.

Send a Polite Reminder as Soon as the Invoice Becomes Overdue

Once the payment deadline has passed, your first step should be a polite reminder.

• Keep the tone professional and courteous.
• Attach the original invoice so the client doesn’t have to search for it.
• Gently remind them of the due date and payment methods.

Sample email snippet:
“Hi [Client Name], I hope you’re doing well. I wanted to follow up on invoice #123, which was due on [date]. I’ve reattached the invoice here for your convenience. Please let me know if there are any issues, otherwise, we’d appreciate payment at your earliest convenience.”

Follow Up with a Firmer Message

If the first reminder goes unanswered, follow up again, this time with a slightly firmer tone.

• Clearly state the overdue status and the number of days past due.
• Mention any late fees outlined in your payment terms.
• Request a specific date for payment.

Tip: Automating reminders through invoicing software can make this process smoother and ensure consistency.

Pick Up the Phone

Sometimes, an email just isn’t enough. A phone call can clear up misunderstandings quickly.

• Ask if there were issues with the invoice or your service.
• Confirm whether they’ve scheduled payment.
• Get a verbal commitment to a payment date.

Example: A client may explain that their accounts payable department only runs payments on certain days, giving you clarity and peace of mind.

Offer Flexible Payment Options

In some cases, your client may be facing genuine cash flow problems. Rather than let the invoice sit unpaid indefinitely, consider offering flexible options.

• Partial payments with a defined schedule.
• Credit card or ACH payment options if they typically pay by check.
• Waiving late fees if they pay immediately.

Being flexible can help you recover funds faster while maintaining a positive client relationship.

Escalate with a Formal Demand Letter

If reminders and calls still don’t work, escalate the matter with a formal written demand.

• Include the invoice number, amount due, and payment deadline.
• Reference any contractual terms or late fees.
• State clearly that legal action or collections may follow if payment isn’t received.

Tip: Send this letter by certified mail or a tracked delivery method so you have proof of communication.

Involve a Collections Agency or Legal Support

As a last resort, hand the matter over to professionals.

• Collections agencies specialize in recovering unpaid debts.
• If the amount is significant, consult with a business attorney.
• Small claims court may also be an option, depending on the amount owed.

While this step can be time-consuming and costly, it may be necessary for protecting your business.

Preventing Outstanding Invoices in the Future

Chasing payments is frustrating. To avoid it altogether, put preventative measures in place:

• Always use clear contracts with defined payment terms.
• Consider requiring upfront deposits for larger projects.
• Automate invoicing and reminders with software.
• Offer multiple payment methods to make it easy for clients.

Bonus Tip: Automate Your Invoicing and Payment Process with DepositFix

The best way to chase fewer outstanding invoices is to prevent them from happening in the first place. DepositFix helps businesses collect payments faster and integrates directly with your CRM, automates payment reminders and offers customers convenient payment options.

With DepositFix, you can:

• Send invoices automatically with embedded payment links.
• Set up automated reminder emails before and after due dates.
• Give customers multiple ways to pay, reducing excuses for late payments.

This eliminates manual chasing and helps you focus on growing your business instead of tracking down overdue payments.

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