How to get customers to pay faster by design, not by chasing

There are two ways to shorten the wait for your money. One is to chase better after the due date. The other is to build a business where fewer invoices ever reach the due date unpaid. The second is quieter, less stressful, and usually more effective.

If you already have a reminder routine and want the escalation side, our companion guide on managing slow-paying customers covers it. This guide is about the front end: the choices that make a customer pay in 10 days instead of 40, without a single awkward phone call.

What actually makes a customer pay?

Think about your own habits. You pay an invoice quickly when three things line up: you know it is due, you know exactly what it is for, and paying takes about ten seconds. You pay slowly when you have to find a person to approve it, key the details into a portal, then dig out a bank number.

So the job is to remove steps. The levers below each remove a different one.

Lever	What it removes	Best for
Deposit upfront	The risk that you do the work and wait	New customers, big or custom jobs
Staged billing	One large invoice carrying the whole contract	Projects, trades, long engagements
Same-day invoicing	Days of dead time before the clock starts	Everyone
E-invoice to accounts payable	Lost, mis-keyed or misdirected invoices	Larger customers
Pay-now link or card on file	The hunt for bank details	Small and consumer-style customers
Direct debit or PayTo agreement	The decision to pay each time	Regular, repeat billing
Early-payment discount	Reasons to hold the cash	A few customers with real cash to spare

Why does the invoice itself decide the speed?

The first delay often happens before anyone could possibly have paid. A job finishes on the 3rd, the invoice goes out at the end of the month, the customer’s terms are 30 days, and money arrives in the first week of the month after. That is more than 60 days for work completed in the first week.

Fix the clock first:

• Send the invoice the day work is finished. Many accounting packages can create and send it from the job itself.
• Put the due date on it as a date, such as “pay by 14 November”, not “net 14”.
• Send it to the person who pays. Ask at the start of a relationship who in accounts handles supplier invoices, and use that address.
• Quote their purchase order or job number. Larger customers often cannot process an invoice without it.
• Say what it is for in plain words. A line like “supply and fit, kitchen exhaust, level 2” is easier to approve than “services rendered”.

A valid tax invoice matters too, since a customer claiming GST credits needs one. The glossary entry on a tax invoice lists what it has to contain.

How does e-invoicing help?

E-invoicing sends invoice data directly from your accounting software into the customer’s system over the Peppol network, with no email attachment and no retyping. The ATO says e-invoices meet tax invoice requirements and that connecting once lets you transact with over 400,000 Australian businesses on the network, whichever eInvoicing-enabled software they use.

It will not make a reluctant payer pay. What it does is remove one of the largest sources of delay on bigger accounts: the invoice that was received but never matched to an order. Commonwealth agencies have set targets to increase the share of invoices they receive as e-invoices during 2026, and small businesses that send e-invoices to participating government buyers may benefit from faster processing. If you supply larger customers, ask their accounts team whether they can receive Peppol e-invoices, and switch it on in your software if so.

Can you make paying automatic?

For repeat customers the strongest move is to take the decision away altogether.

• Card on file for subscriptions, memberships and retainers.
• Direct debit on an agreed schedule, signed up at the start of the relationship.
• PayTo. This New Payments Platform feature lets a customer authorise a payment agreement from their own bank account, so you can collect agreed amounts on set dates. It suits regular billing, and availability depends on your bank or payment provider.
• Pay-now links on every invoice, so a customer can settle from their phone straight from the email.

Autopay works best when the amount is predictable. Pair it with clear notice before each debit so customers are not surprised, which also reduces disputes and chargebacks.

Do early-payment discounts pay for themselves?

Sometimes, and the way to find out is in dollars, not percentages.

Say you invoice $10,000 on 30-day terms and offer 2 per cent off if paid within 10 days. The discount costs you $200. If the customer pays on day 10 instead of day 30, you have the $10,000 twenty days earlier. If you are running an overdraft or using a line of credit, compare the $200 with what twenty days of that borrowing would cost you. If the borrowing costs less than $200, the discount is the more expensive way to buy time. If your alternative is turning down work or paying a supplier late, it can be good value.

Three rules keep it sensible:

1. Offer it to the customers who would not otherwise pay quickly, not to everyone. Reliable payers will just take the discount.
2. Write it into the terms before the work, so it is not a surprise.
3. Do not retrofit it to a late invoice. That teaches customers to wait for a sweetener.

Which approach suits which customer?

Different customers respond to different levers, and mixing them is how businesses end up with one customer base and four systems.

• New customers: deposit, clear terms and a pay-now link.
• Regular small customers: card on file or direct debit.
• Large corporates: accurate e-invoice or PDF with the purchase order, sent to accounts payable, with the business’s published payment terms in your agreement. Under the Payment Times Reporting Scheme, big businesses report their payment times, so you can see how they actually behave.
• Government: know the agency’s payment policy and use e-invoicing where they accept it.
• Project clients: milestone billing with a defined trigger, such as “on lock-up” or “on delivery”.

Our guide on late payment options for a small business picks up where these steps leave off.

A worked example

Illustrative only. A Sunshine Coast signage business invoices about $52k a month. Its average collection time is 41 days, so roughly $70k is outstanding at any moment. The owner changes five things.

1. Invoices go out on delivery day instead of weekly. This takes about four days off the average.
2. Jobs over $3,000 require a 30 per cent deposit. Cash arrives on day zero for those jobs.
3. The three biggest accounts receive e-invoices with purchase order numbers, which stops a pile of invoices bouncing around approvals.
4. Regular small customers move to card on file.
5. One reliable customer gets 1.5 per cent off for payment in 7 days.

Six months later the average is 29 days. Outstanding receivables are roughly $50k instead of $70k, which means about $20k of cash has been released without borrowing a dollar. The early-payment discount costs a few hundred dollars a month, and the owner reviews it each quarter against the line of credit it replaced.

What if cash is still short while the changes take hold?

New habits take a few billing cycles to show in the bank. In the meantime payroll and suppliers do not wait. Options include invoice finance on the reliable-but-slow customers, a line of credit, or a short loan. The invoice finance calculator shows what an advance on a given invoice could cost in dollars, and why profitable businesses run out of cash explains why the gap can open even in a good year.

Mistakes that keep invoices slow

• Month-end batch invoicing. It adds weeks you never see.
• One generic reminder for everyone. Match the message to the reason.
• Offering every customer the same discount. You subsidise the people who would have paid anyway.
• Skipping the deposit to win the job. It saves a conversation and costs a month.
• Not asking who pays. A correct address is worth more than a polite chaser.
• Setting up direct debit without telling the customer. Surprise debits cause disputes.

Need cash while the new system settles in?

If customers owe you more than the business can carry for the next month or two, you do not have to wait on process improvements alone. We can look at what you are owed, who owes it and how reliable they are, then say whether funding makes sense.

An enquiry is a one-minute form, and sending it will not change your credit score. It is read in-house, not circulated to a list of funders, so the only call you get is ours. A real person looks at your figures first. Enter the true size of your outstanding invoices and how long they usually run, because that is what lets us point at the right product the first time.

Ask about funding against unpaid invoices →