What Steps Are Taken During The Payment Settlement Process?

What Steps Are Taken

What is Payment Settlement Process?

You make a sale and expect to get your money as soon as customers receive the goods. Not every customer makes a timely payment for an invoice. In such cases, you must chase the amount and go through the payment settlement process to get your money.

Customer Order Creation

Most people think payment settlement starts after the due date is over. However, it begins with invoice creation when the customer places an order with you on your website or makes an in-store purchase. Once you provide the service or the product, you generate an invoice that the customer can pay by the due date.

Payment Reminders

After the invoice is issued, you should not forget about it until the due date arrives. Take a proactive approach and send payment reminders to your debtor through emails, texts, or phone calls.

The Customer is Unable to Make a Payment

As the due date arrives, the settlement process ends here. If the customer makes the payment, then the settlement process ends here. However, there are many circumstances where the customer cannot pay the amount.

Draw Out a Debt Settlement Contract

In such a condition, the best way to help yourself and the customer is to reach a debt settlement contract. In a debt settlement contract, you and the customer agree to settle the debt amount as partial payments through installments or settle the entire amount with a discount.

Receiving the Payment

Once the debt settlement contract is drawn, the customer can make payment. Opting for a debt settlement makes it easier for both parties as the customer can pay off their debt quickly, and you don’t lose money as bad debts.

Benefits of Payment Settlement Process

Payment settlements process ensure you don’t lose out on all the money the customer owes you. It also helps you avoid the long-and drawn-out legal process of getting the money from your debtors.