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- Agree the credit period and limit before the first credit sale, not when the payment is late.
- Send the invoice the same day and remind before the due date, not after it.
- Review outstanding by age every week and act on anything past 60 days.
- Stop further credit once a customer crosses the limit you agreed.
Udhaar is how Indian business runs. A wholesaler who refuses credit loses the shop down the road, and a shopkeeper who refuses it loses the family that has bought there for twenty years. Credit itself is not the problem. Credit that nobody tracks is.
If you are busy all month and still short of cash, the money is usually sitting in your customers’ accounts. These seven habits bring it back sooner.
1. Set Terms Before the First Sale
Tell every credit customer two things at the start: how many days they have, and the maximum they can owe at one time. Write both on the invoice. A customer who was told “30 days, up to ₹50,000” is far easier to remind than one who was told “pay when you can”.
2. Bill the Same Day
A payment clock starts when the customer receives the invoice. If you bill a week after delivery, you have given a week of free credit. Send the invoice on WhatsApp or email the moment the goods leave.
3. Remind Before the Due Date
Most late payments are not refusals. The customer forgot, or paid whoever asked first. Be the one who asks first, and politely.
- Day 0Send the invoiceWith the due date and your UPI or bank details.
- Day 27Friendly reminderA short message three days before the due date.
- Day 30Due dateA message with the amount and a way to pay now.
- Day 37Phone callAsk if there is a problem with the goods or the bill.
- Day 45Hold further creditNew orders against payment until the account is cleared.
4. Make Paying Easy
Put a UPI ID or QR code and your bank details on every invoice and every reminder. Each extra step between “I should pay” and “paid” costs you days.
5. Look at Outstanding by Age, Every Week
A single outstanding total hides the danger. What matters is how old the money is.
Example: where ₹10 lakh of outstanding is sitting
Spend your collection time from the bottom of this list upwards. Money past 90 days needs a visit or a firm conversation, not another message.
6. Hold the Limit
A credit limit that is never enforced is not a limit. When a customer reaches it, the next order goes on payment. Say it kindly and say it every time. Good customers respect a business that is run properly.
7. Know What the Law Gives You
Two rules strengthen your hand with business customers:
- GST. A registered buyer who has not paid you within 180 days of the invoice date must reverse the input tax credit on that invoice, with interest. A polite mention of this often speeds things up.
- MSME payments. If your business is registered as a micro or small enterprise on Udyam, the MSMED Act limits the agreed credit period to 45 days and provides for interest on delayed payment.
Let the System Do the Remembering
Tracking credit in a notebook works for ten customers. It fails at a hundred. In Saniiro, every credit sale and every receipt updates the customer’s outstanding as it is entered, and payment reminders can go out by SMS, email or WhatsApp. See how it works in Saniiro billing and Saniiro accounting.