Category: Collections
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What Are Dunning Letters? Meaning, Types & Best Practices
Late payments are a reality for most businesses. In many cases, customers don’t delay payments intentionally — invoices get missed, approvals take time, or priorities shift. This is where dunning letters play a critical role in the accounts receivable process. When done right, dunning letters help you get paid faster…
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Pay to the Order of Checks: The Definitive Guide
Introduction Even in the age of instant transfers and digital wallets, “Pay to the Order of” check payments still play a key role in how businesses move money. For many B2B transactions, “Pay to the Order of” checks remain a familiar, secure, and auditable payment option. But “familiar” often means…
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Payment Discounts: Why Early-Payment Trade Promotions Are Smart for You?
Introduction Cash flow is the backbone of every business — yet, long receivable cycles can slow down even the most efficient finance teams. Waiting 30, 60, or 90 days for payments can create liquidity gaps, hinder operations, and impact growth. Early-payment discounts, or trade promotions for early payments, are an…
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How to enforce Payment penalty for late payments in A/R?
Table of Contents Introduction Late payments aren’t just frustrating — they interrupt cash flow, delay growth, and strain customer relationships. For finance teams managing dozens of accounts, chasing overdue invoices can feel endless.That’s where payment penalty enforcement comes in — not as a punishment, but as a tool to ensure…
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How to write Collection Letters? Guide for Collections & AR Teams
Businesses lose millions every year due to delayed payments, broken follow-ups, and poor debtor communication. All of this happens when firms don’t have the right Collection Strategy to be followed. To implement the right collection strategy, a well-designed collection letter strategy helps recover dues faster, maintain customer relationships, and reduce…
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What is Aging Report and How AI Improves Aging
An Aging Report—also known as an Accounts Receivable Aging Report, AR Aging Report, or Receivable Aging Report—is a vital financial tool that helps businesses track outstanding invoices and monitor customer payment behavior. By organizing receivables according to the length of time invoices have been unpaid, finance teams can identify overdue…
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Best Possible DSO vs Standard DSO – What Every Finance Leader Should Know
When it comes to managing accounts receivable (AR) and improving cash flow, few metrics are as closely tracked as Days Sales Outstanding (DSO) esp – Best Possible DSO vs Standard DSO. But there’s a growing realization among CFOs and finance teams that Standard DSO alone doesn’t tell the full story.…
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Why Your DSO Reduction Isn’t Working – Even Though Your Team Is Chasing Harder?
It’s a story finance teams know all too well. The collections team is following up consistently. Escalations are happening on time. Every interaction is logged and tracked. And yet – Days Sales Outstanding – DSO reduction doesn’t happen. For many mid-market and enterprise finance teams, this stagnation feels baffling. On…
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What is a Collection Policy?
Definition : A collection policy is a set of guidelines and procedures that an organization uses to manage the collection of payments owed by customers for goods or services provided. It outlines the steps taken to ensure timely payment of outstanding invoices, defines acceptable payment terms, and specifies the methods…
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What is Collection Effectiveness Index (CEI) & it’s Impact on Cash Flow
Collection Effectiveness Index (CEI) Definition : The Collection Effectiveness Index (CEI) is a key performance metric used by businesses to evaluate the efficiency and effectiveness of their accounts receivable collection efforts. It measures how well a company is collecting its outstanding receivables within a given period, providing valuable insights into…