{"id":501,"date":"2017-03-14T13:14:09","date_gmt":"2017-03-14T02:14:09","guid":{"rendered":"https:\/\/marshallfreeman.com.au\/blog\/?p=501"},"modified":"2026-04-08T13:51:56","modified_gmt":"2026-04-08T03:51:56","slug":"how-to-use-email-to-improve-your-debt-collection-process","status":"publish","type":"post","link":"https:\/\/www.marshallfreeman.com.au\/blog\/how-to-use-email-to-improve-your-debt-collection-process\/","title":{"rendered":"How To Use Email To Improve Your Debt Collection Process"},"content":{"rendered":"

How To Use Email To Improve Your Debt Collection Process<\/h1>\n

A recent global survey revealed that more than 60% of invoices are paid late<\/a><\/u>. Even worse, Australia tops the list with invoices being paid on average 26.4 days overdue.<\/p>\n

It\u2019s no wonder then that so many Australian businesses spend so much time chasing late payments. This is not only frustrating, but costs your business time and money. It can also potentially strain your relationships with your customers.<\/p>\n

Email is a great tool to improve the efficiency of your debt collection process. Structured and timely emails will not only save you time, but can help reduce the amount of outstanding debt you have.
\nBelow, we outline the key email communications, and when these should be sent for maximum effectiveness.<\/p>\n

1. Pre-due date reminder<\/strong><\/p>\n

Send this friendly reminder 3-5 days before payment is due. Explain what the payment is for, how much is owed and detail the various payment methods that can be used.<\/p>\n

You should also use this email when a direct debit arrangement has been set up as it prompts your customer to ensure they have enough funds in their account before the invoice amount is deducted.<\/p>\n

2. First overdue email<\/strong><\/p>\n

Usually sent within 48 hours of payment being overdue, this email should also be friendly, but clearly communicate that payment is now overdue and is required immediately.<\/p>\n

Include full details of the transaction including the products or services provided, the total and outstanding balance, a revised due date (commonly 7 days from the day you send the email) and for reference, a copy of the contract or purchase agreement.<\/p>\n

If applicable, also explain that late payments may attract additional fees or interest charges as per the Terms and Conditions of your agreement.<\/p>\n

3. Second overdue email<\/strong><\/p>\n

If payment has still not been made by the revised due date, then you need to become a bit firmer in your communications.<\/p>\n

Still remain courteous, but remind them that payment is now <number of days> overdue and requires immediate attention. Offer them 48 hours to either settle the payment in full or contact you to negotiate and agree on a payment plan.<\/p>\n

Let them know in your email that failure to pay or respond within the stated timeframe will result in an escalation to your debt recovery team. It\u2019s important to have a debt collection agency<\/a> on hand to take over collections for you if you need to escalate, as a basic email from them using their business\u2019 letterhead will generally evoke a response and settle the debt.<\/p>\n

Email correspondence can obviously be managed manually, or you can choose to automate the process using technology or accounting software like Xero or MYOB. Whatever method you use to manage the process, by simply implementing a consistent and clear email strategy will save you time, and improve your ability to recover outstanding payments.<\/p>\n

If you\u2019re looking to improve your debt collection process, you may also like to check out other articles we have written on how to improve your ability to collect outstanding debts and ways to getting paid quicker.<\/p>\n