Automated payment reminders and dunning: collect receivables faster, improve liquidity, preserve customer relationships.
Outstanding receivables are one of the biggest drains on SMB liquidity. On average, 23% of all invoices are not paid within the payment deadline. But manual follow-up is time-consuming and uncomfortable — nobody enjoys writing dunning letters.
Without systematic receivable management, weeks often pass before a first reminder is sent. Every day of delay costs liquidity and increases default risk. At the same time, tone and timing must be right: too-aggressive dunning damages customer relationships, too-gentle reminders go unnoticed.
Small teams especially rarely have a person dedicated solely to open items. Dunning gets done between other tasks — or is forgotten entirely.
The economic damage from late payments is enormous: according to the European Payment Report, 25% of all business bankruptcies in Europe are caused by customer payment defaults. For service providers and freelancers with limited cash reserves, a single late payment can threaten their very existence. At the same time, many business owners hesitate to send payment reminders because they fear damaging customer relationships.
Manual tracking of outstanding receivables is also error-prone: invoices get overlooked, reminder deadlines pass, and visibility into the current accounts receivable position is lost. In practice, this means many SMBs wait unnecessarily long for 15-25% of their outstanding invoices or ultimately have to write them off as bad debt — directly impacting profitability and growth potential.
Our dunning workflow automatically monitors all outstanding receivables and sends time-triggered reminders in escalating severity. The first friendly reminder goes out 3 days after due date, the second after 10 days, the formal dunning letter after 21 days.
Each reminder is personalized: customer name, invoice number, amount, and due date are automatically inserted. The tone adapts to the escalation level — from collegial to formally assertive. For VIP customers, escalation can be manually paused.
All actions are logged in the CRM: who was reminded when, which invoices are still open, which were paid. A weekly receivables report gives management a clear overview of customer payment behavior.
The intelligent reminder workflow automatically escalates through three dunning stages: friendly reminder (3 days past due), formal payment request (14 days), and final notice with late interest calculation (30 days). Each stage uses personalized templates that automatically insert the company name, outstanding amounts, and payment details.
Integration with your accounting system detects incoming payments in real time, ensuring already-paid invoices are never erroneously reminded. A dashboard displays the current DSO (Days Sales Outstanding) value and identifies chronically late payers for proactive relationship management. Businesses using this workflow report a reduction in average payment duration from 45 to 22 days — and a 73% decrease in bad debt write-offs, translating to significant cash flow improvement.
Yes, you can individually configure escalation levels, waiting periods, and tone per customer group. VIP customers can be exempted from automatic dunning.
The workflow reconciles with your bank data daily. As soon as a payment is received, the invoice is marked as settled and further reminders are stopped.
German and English are available by default. Additional languages can be added via custom templates.
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