September Credit Management FAQs
Please find below our credit management FAQs for the month of September.
Can I charge interest on overdue invoices?
If your terms and conditions don’t stipulate otherwise, you can changed Late Payment Legislation; this allows you to charge 8% above Bank of England reference rate, that is set every 6 months (visit Pay on Time to current rate), as well as compensation and debt recovery fees. Read more about Late Payment interest here.
What is the most I can claim when using the small claims courts?
You can use the small claims courts to claim up to £10,000 (including interest, compensation and debt recovery fees). £10,000 and over is fast track, at this stage you would be required to bring in solicitors to handle your claim.
Is it worth using the small claims courts to retrieve money that has been owed to me for a long time?
The statute of limitations to claim for money owed to you is up to six years; however I would recommend taking action as soon as possible.
What are debtor days?
Debtor days (days sales outstanding) are the average number of days your customers take to pay you; you should track debtor days month on month to set targets and highlight any trends.
What can I do if a customer is ignoring my emails?
If you have sent multiple emails to the same customer with no joy, your next step is to phone the business; this will ensure that you are contacting the correct person, and they are less likely to ignore you. Failing this, a letter in the post (and attached to an email) tends to have more gravitas than emails or phone calls alone, your customer may take you more seriously as a result. If you are still being ignored you need to escalate and consider sending a final demand, see our Collection strategy toolkit for help with this.
