Overdue payment
Overdue payment is a bill or invoice that has not been paid by the due date shown on your invoice or agreed in a contract. It can be the full amount or just the unpaid balance, and it puts pressure on your cash flow.
Reduce late payments
Show a clear due date, accepted payment methods and contact details on every invoice. Consistent terms make chasing easier.
How you handle an overdue payment should follow your written terms and fair practice. With business customers you may add late fees or interest if your terms allow; with consumers use clear, reasonable steps and consider a payment plan where appropriate.
Typical steps when a payment becomes overdue:
- Check the agreed due date and any grace period in your terms.
- Confirm the customer received the invoice and the goods or service.
- Send a friendly reminder that states the amount due, original due date and how to pay.
- Follow up with a statement or formal notice if there is no response.
- Apply agreed late fees or interest only if your terms allow and the customer has been informed.
- Offer a payment plan or split the invoice if it helps recover the debt.
- Escalate to collection or legal support as a last resort.
- Update your accounts: mark the invoice overdue and track it in aged receivables.
Simple example
If an invoice due on the 15th is paid on the 20th, it is 5 days overdue. If your terms allow a late fee or interest, you calculate it from the day after the due date.
