Payment Letters

Letters requesting payment of overdue accounts are called "collecting letters”. Their aim is to persuade the customer to settle his account and, at the same time, not to offend him, as this might lead to a loss of a business.

         The first request for payment therefore should be friendly in tone, tactful and marked "confidential”. It may take the form of end-of-the-month Statement of account. If no reply is received, a second request, firmer in tone, should be sent. If payment is still not made, and no explanation received, the third letter must be sent. This time the writer may state what steps he intends to take to enforce the payment. Even this final letter threatening legal action must be written "with regret”.

Points to remember:

1. Invoices record goods that have been sold. The commercial invoice is one of the main documents used in trading; it may be accompanied by a short covering letter.

         2. Pro-forma invoices are sent in the case of pre-payment, or to inform the customer of the price.

         3. Statements of account are sent monthly or sometimes quarterly, and include details of all transactions within the period.

         4. There are various methods of payment available through the Post Office and banks. Letters accompanying payments are usually short, giving information about the payment and what it refers to, but they can also be used to, say, propose new terms of payment or to make complaints.

         5. Letters advising and acknowledging payments tend to be short and routine, but they may be used to, say, propose new terms of payment or to make complaints.

6. If you are asking for more time to pay, you should apologize for not having cleared the account in the due date, explain why you have not paid, and when and how you intend to clear the balance. Remember, your creditor is more interested in when he gets his money, than good excuses.

The sample letter of Payment.