Is it normal to wait ages for a payment? Or to only send reminders once an invoice is overdue? Although cash flow is essential to the health of any business, many CFOs fall into the same traps. These are the three most common misconceptions – which one are you guilty of? Payt helps you overcome these pitfalls with smart, practical solutions.
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Long waits for payment are just part of business
Waiting 60 days to get paid may feel like standard practice – especially in the Netherlands, where only half of invoices are paid within the agreed payment term.
But “that’s just how it is” doesn’t have to be your reality. You have more influence over your debtors’ payment behaviour than you might think. By consistently sending reminders and offering personalised payment plans, you can significantly reduce waiting times. And with automated credit management, you’ll spend less time chasing invoices.
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Reminders should only be sent after the due date
In many standard processes, reminders are only triggered after the due date has passed. Sometimes it’s just a few days later – sometimes it's weeks or even a quarter down the line. When a customer receives a reminder so late, they may not even remember what the invoice was for. This significantly lowers your chances of prompt payment.
In reality, most customers – whether B2B or B2C – appreciate a timely reminder. Anyone can forget an invoice. By sending a gentle reminder before the due date, you greatly increase your chances of receiving payment on time.
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Invoicing isn’t a game
Just because invoicing is serious business doesn’t mean it can’t be made more engaging! Humans are naturally competitive – it’s why gamification works so well in non-game environments. Add a game element to your credit management process and motivate your team with smart challenges and rewards.
Here are a few ideas:
- Can your team shorten the average payment time?
- Who can reduce the number of reminders sent – without affecting the speed of payment?
- How many reminders are sent on time after the invoice is issued? Can you hit 100%?
Bonus misconception: invoices don’t need updating
In the early years of a company’s growth – or when a new finance manager joins – invoice templates often get a revamp. But once things settle, those templates rarely change. That’s a missed opportunity.
Reviewing your invoice layout and content regularly helps customers pay faster.
Consider:
- Offering multiple payment options, including newer digital methods. Highlight your preferred method for added clarity.
- Using clear, friendly language. Spell out what’s expected so your customer doesn’t have to guess.
- Ensuring key details: name, address, bank details, VAT number, amount, and payment term – are accurate and easy to find.
By challenging these misconceptions and making small changes to your invoicing process, you’ll improve payment behaviour, save time, and boost your cash flow. Ready to change your mindset? Payt can help.
