11 Collections Email Templates To Double Productivity of Operations

e–book
11 Collections Email Templates to Double

Productivity of Operations
This ebook unveils the 11 most effective templates that will help you
collect your receivables faster. The ebook is a culmination of our
work with credit and collection experts over more than 400 credit
and A/R transformation projects across the world.
11 Collections Email Templates to Double Productivity of Operations e–book
Contents
1. The State of Collections Management ............................................................................................ 3
1.1 Overview ................................................................................................................................................................ 3
1.2 The Standard Collections Process.......................................................................................................................... 4
1.3Major Bottlenecks of the Collections Process ........................................................................................................ 6
1.4 Solutions to Common Collection Challenges ....................................................................................................... 10
1.5 Summary .............................................................................................................................................................. 11
2. A Strategic Look at Collections Correspondence .......................................................................... 12
2.1 The Correspondence Approach – Before vs. Today ............................................................................................ 12
2.2 Correspondence Automation .............................................................................................................................. 14
2.3 Three Pillars of Customer Correspondence......................................................................................................... 15
3. The 11 Unbeatable Collection Templates ..................................................................................... 17
3.1 Pro-active payment reminders ............................................................................................................................ 17
3.2 Early-payment discount reminders ..................................................................................................................... 18
3.3 First past-due reminders ..................................................................................................................................... 19
3.4 Second past-due reminder .................................................................................................................................. 20
3.5 Third past-due reminder...................................................................................................................................... 21
3.6 Suspension of credit ............................................................................................................................................ 22
3.7 Default on payment commitment ....................................................................................................................... 23
3.8 Escalation notice .................................................................................................................................................. 24
3.9 Collecting from key accounts .............................................................................................................................. 25
3.10 Collecting from Slow-paying customers ............................................................................................................ 26
3.11 Collecting from Fast-paying customers ............................................................................................................. 27
4. The Role of Technology in Collections .......................................................................................... 28
5. About HighRadius .......................................................................................................................... 30
HighRadius’ Integrated Receivables Platform ........................................................................................................... 30
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©2017 Highradius Corporation
1. The State of Collections Management
1.1 Overview
Most industries, apart from those that deal with consumers, work on a trade credit model. Suppliers and
buyers enter into an agreement that refer to “payment terms” which dictate the conditions under which a
seller will complete a sale. Depending on the industry, payment terms may vary widely from ‘payment in
advance’ to payment ‘90 days after invoice date.’
In an ideal world, suppliers wouldn’t need collections teams as buyers would pay ‘in full and on time,’ every
time. However, a survey revealed that 48% of customers do not pay on time and businesses lose 52% of the
value of receivables for invoices which are more than 90 days past-due. In an effort to keep close tabs on the
health of their receivables, finance departments have relied on a key metric - DSO.
A higher DSO implies lower cash on hand, therefore requiring companies to rely on borrowings to fund
operations and keep business running. Collections teams are therefore necessary to maintain a low DSO, as
they help convert receivables into cash and assist the finance team to reduce borrowing costs.
However, as most readers would agree, credit collection is no mean feat. Despite all the advances in
technology, collections continue to heavily rely on old-fashioned dunning correspondence to remind
customers and creditors about invoices which are due, or already past-due. Growth in businesses, through
organic and inorganic expansion, has only meant more demand. This has led directly to more transactions
with an ever-rising number of customers. The collections challenge is clearly not going away.
A great deal of insight into the future of collections management could be gained by looking at how
collection processes have evolved over the years. The rest of this chapter takes a closer look.
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1.2 The Standard Collections Process
Collections Process
Create Customer Log Track Payment Set Reminders Receivable

Prioritized Correspondence Correspondence Commitment for Follow-up s Collected
Worklist Activity
Performance Define Collection

Analysis Strategies and
Rules
FIGURE 1: DESC RIBING ALL THE P R OCESSES OF COLLECT IONS

MANAGEMENT
1. Create Prioritized Worklist

The first step in the collections process is to create a prioritized worklist. This worklist determines the order
in which the collector is going to work or initiate the dunning process on the open or past due invoices. It is
imperative that this worklist is prioritized based on some factors like dollar value or the period of past due
(90days+ past due/ 30 days+ past due) of the open invoices. Once the list is prioritized, collectors can start
contacting the customers.
2. Send and Log Customer Correspondence

Now, the collectors can contact the customers. The cornerstone of the collections process, correspondence
relates to any activity that is performed while reaching out to a customer for payment. This includes
dunning, reminders, sharing of account statements and any other information that is required by a
customer. It requires a system of record. Collectors need to keep a track of all the information shared during
a correspondence activity or a phone call. This could include noting down specific queries made by the
customer or any other follow-up tasks that is to be performed in future. These logs are maintained by the
collectors for all customer correspondence.
3. Tracking Payment Commitments and Setting Up Reminders and Follow-Ups

Customers often inform collectors about payments that they are going to make in the future. However, the
obligation of keeping track whether these commitments have been honored or not relies on the collector.
Collectors need to keep a close watch on all the commitments made by customers, and follow-up if the
payment has not been made. Even for these follow-ups, the collector might need to set-up reminders on the
sheets to prompt them to correspond with the customer again until the payment is made.
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4. Performance Analysis
To monitor the performance of the collections management process, it is imperative to regularly analyze the
deliverables of the team. It helps to identify the strategies working best and driving positive outcomes as
well as to weed out all possible poor performing tactics from the collections process.
5. Defining Customer Strategies and Rules

Collections management system should be based on strategically determined rules and strategies. This is
instrumental in defining recommended actions for collectors. Having a well-defined collections action policy
in place ensures that every collector on the team is following a course of action that is most likely to result in
positive outcomes.
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1.3 The Major Bottlenecks of the Collections Process
While the collections team deal with several kinds of customers depending on the industry in which they
operate, there are a few common collections challenges that occur across all industries:
1. Lack of Collectors to Deal with The Growing Volume of Due Invoices:
This is the most common problem faced by collections teams worldwide. Most collection managers find
their teams overstretched. However, even adding more resources is not necessarily a perpetually scalable
1solution. With growing businesses and receivables volume, the number of overdue receivables also keeps
on increasing across various geographies. While initial positive impact in terms of DSO reduction may be
visible with the onset, the costs of a constantly growing team will soon be unable to justify the results.
Organizations will not be able to afford adding resources to dig into the mounting receivables volume.
2. Prioritizing Customers for Collection Activity

For years, collections analysts have traditionally relied on ageing lists to find out the items which need to be
worked on any given day. The flaw with this approach is that it does not take into account the variables
which impact collections outcomes. Some of these variables are discussed below.
• Items with Open ‘Promise To Pay’: If there are items with an open promise to pay, or items with a
future payment promised on a date, these items should ideally be excluded from the ‘To Be
Collected’ accounts list (invoices on collector’s worklist henceforth referred as accounts), unless a
dunning activity is planned very close to the ‘pay-by’ date.
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• Dispute Cases: All open dispute cases, which have not yet been resolved or identified as ‘invalid,’
requires dunning should also be excluded from the ‘To Be Collected’ accounts when preparing the list
of open customers based on outstanding accounts.
• Items with a current dunning notice: Repeatedly including items which have been dunned recently
leads to a lot of redundant collections activity. Moreover, it also impacts the customer relationship. If
the customer has been recently communicated to, it is best to leave them out of the collections list
for a pre-determined interval of time.
• Items arranged for payment: All amounts that are:
o collected with a debit memo procedure
o has an account statement balance containing a payment notification from the bank should be
excluded from the ‘To Be Collected’ accounts, when preparing a collection list.
3. Identifying The Right Contact at A Customer Organization

Supplier-buyer relationships are becoming very complex with businesses supplying to many independent
business units or divisions within the same buyer organization. The problem of identifying the right contact
for dunning is worsened by the lack of proper customer master data. Collections analysts remain unclear
about whom to contact at the customer organization. For suppliers selling to large national retailers, such as
Walmart and Target, such problems are even more common
4. Applying The Right Collections Approach for Each Customer

Collections teams deal with customers and buyers of all sizes, from small mom and pop stores to large
retailers. In the absence of a well-defined strategy to select the right mode and style of communication,
customer correspondence becomes a challenge. The sheer volume of customers means that calling every
customer is not the most judicious use of time. Variables such as past payment behavior and customer type
should also dictate the mode of communication.
• A small and medium business customer who tends to pay just by receiving email reminders should
ideally be sent only email reminders.
• Key large accounts require a qualitative approach that emphasizes building a relationship with the
customer and working out mutually beneficial solutions to issues.
Collections analysts therefore are always challenged by their single biggest responsibility of reaching out to
customers. In fact, studies show that collections teams have struggled with customer correspondence and
close to 70% of collections calls go to customers who would have paid even without dunning notices or
telephonic reminders.
5. Collections Operating in A Silo from Other Receivables Processes

Many teams operating in the credit and accounts receivable processes are often seen as operating in silos.
This modus operandi has significantly reduced operational efficiency. The disconnect between teams results
in additional manual work and clerical collaboration required by collections teams to access data which is
usually vital for their success:
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• Sales terms, deal sheets or discounts offered by sales teams

• Information on unapplied payments
• Information on unused credits
• Status on open and resolved deductions
Timely access to accurate data could greatly improve the effectiveness of collections operations. However,
siloed systems and poor collaboration have meant that collections teams continue to lack the necessary
means to improve efficiency.
6. Ad-Hoc Information Requests from Customers:

The customer is king, and as purported champions of a good customer experience, collections teams have a
hard time saying ‘no’ to customer requests. Customers routinely request additional invoice copies, account
statements and bill of lading, proof of delivery, among other invoice and order-related documentation.
Most collections analysts spend at least 30% of their time catering to such ad-hoc requests given that the
requested information is scattered all over the place. For example, downloading a proof of delivery
document requires analysts to go to the carrier website, enter tracking numbers and then download the
required materials. Declining ad-hoc requests from customers is not a solution, as it is only likely to delay
payments. The solution has to be sought that brings all the necessary information to a single place for
collections analysts to access and serve.
7. Measuring The Effectiveness Of Collections Operations

While DSO is a great metric to measure the overall health of accounts receivable, A/R managers and leaders
struggle with performing a root-cause analysis when faced with higher than expected DSO. One of the more
important factors that impacts DSO is ineffective collections operations. And the inability to accurately
measure the performance of collections teams could very well be the Achilles’ heel of even the most
successful A/R departments. Collections managers routinely struggle to find answers for questions similar to
the ones described below:
• Which mode of communication works best for which segment of their customer base?
• How do we conduct comparative analysis of collections analysts on the effectiveness and outcomes
of their activities?
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Lack of Collectors to Deal with Growing Volume of Due Invoices
Prioritizing Customers for Collection Activity
Identifying the Right Contact at A Customer Organization
Applying the Right Collections Approach for Each Customer
Collections Operating in A Silo from Other Receivables Processes
Ad-hoc Information Requests from Customers:
Measuring the Effectiveness of Collections Operations
Summary of Challenges
While some teams and companies innovate with new processes and systems, others fail and falter as they
continue plying old solutions to very new and unique problems and challenges. Due to the sweeping changes
over the last few years, many teams are unable to deliver the results to which their previous finance teams
were accustomed hence calling for a change.
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1.4 Solutions to Common Collection Challenges
Figure 5: Types of Collections Management Systems
While companies are diving in to employ the latest collections management software, it is important to
obtain a very clear understanding of the different types of collections management solution available.
Receivables Master Data Management Systems

The most basic type of collections management solution will help the teams gain a consolidated view of all
the customer accounts along with important information related to open invoices and customer contact
personnel. This kind of system is most useful for teams which already have a solid communication execution
and tracking platform in place. The primary purpose of such systems could be to help analysts review the
data and manually prioritize and create their account lists for collection.
Dunning Activity Management Systems

The next level of solution includes functionality provided by receivables master data management systems
described above, but also handle dunning activity. These systems serve as a means of record keeping to
track all collection activity and correspondence. Some of these systems are also able to help collections team
leaders to define strategies and rules based on various collection scenarios, which are executed by the
collection analysts in the course of their work.
Correspondence Automation Systems

Considering that correspondence is the single most important activity performed by the collections team, it
becomes justified that there exists a type of system that caters to this particular requirement. Ideally, a
correspondence automation system should handle and maintain multiple correspondence templates that
are needed by the collection analysts. In addition, these systems should perform correspondence activity
across mediums including print and mail, email and fax, as well as keep track of all phone-based collection
touchpoints. Compared to the previously outlined systems, these solutions are completely capable of
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automating manual work involved in creating correspondence, selecting accounts and contacts and then
sending out emails or dunning notices.
Integrated Collections Management Systems

One of the challenges discussed earlier was how collections teams end up working in silos, isolated from key
information that is crucial for successful collection outcomes. An integrated collections management system
should be capable of linking all data-sources across the receivables domain – including deductions, disputes,
payment processing and invoicing – and be able to present a single source of truth for collections teams with
which to work. Organizations are already leveraging integrated collections management systems to free up
their teams from the manual work involved in preparing collection lists, sending out email correspondence,
searching for information and documentation from different teams and keeping track of overall collections
activity. This automated process allows teams to focus on the most high-touch aspect of collection activity
that involves dunning via phone.
1.5 Summary
Collections Management is indeed one of the most complicated of the accounts receivable processes.
Further, leaders in the Collections Management field are faced with multiple challenges – both internal and
external. However, most collections leaders identify correspondence management and correspondence
automation as the lowest hanging fruit towards effectively transforming receivables operations.
The next chapters focuses on correspondence automation and explain how the approach towards customer
correspondence requires a drastic overhaul.
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2. A Strategic Look at Collections Correspondence
2.1 The Correspondence Approach – Before vs. Today
Evolution of Collections Management Practices
• Reactive Approach • Proactive Approach

A
F
• No Prioritization • Prioritized Activity T
B E
E
F
• Phone Call • Modes of Communication R
O
R • Ad Hoc Collections Policy • Regulation Driven Policy
E
• Focus on Payments • Customer Relationship Focus
Evolution of Collections Management Practices
Like most processes in back-office finance, collections has traditionally been viewed as a linear operation.
The single-minded objective of getting customers to ‘pay up’ led to a single-dimensional approach to
collections management. Some of the trademarks of the collections teams which continue to operate with a
traditional approach are outlined below.
A Reactive Approach
Typically, collections as a process was activated only when a customer had defaulted, and in some cases,
only for a large default value. Such an approach does not see prior follow-ups and intimations as a norm,
even for large amounts pending with risky customers. The limited team sizes combined with the overly
simplified priority of collecting from larger customers meant that the teams could never reach out to 100%
of the open accounts within the valid payment terms.
More Phone Calls Each Day Means Less Outstanding Amount

Phone calls were considered the best way of getting a customer’s attention about a late invoice payment.
Phone calls did have a definite advantage with customer connection because the conversation was 1-on-1
and more personal. The direct call resulted in faster return of outstanding amounts. Therefore, connecting
with the customer via phone was considered the most effective way to get paid. However, phone calls also
meant more time spent for collecting a single invoice. This coupled with the tendency to call customers only
after payments were due, meant that fewer customers could be reached on time. While high-touch
customer connection using phone calls made sense, effective utilization continued to be a major challenge.
Collection Policies Created to Protect The Interest of Suppliers

In the past, companies maintained a very outbound approach towards collections management. The only
objective was to get paid ‘on time’ and ‘in full.’ While the intentions were precise and objective, the means
often came at a compromise of the customer experience. Policy making around collections lacked any
incorporation of the customers’ needs and concerns.
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A Confrontational and Persistent Approach Towards Customers

Irrespective of how some customers easily make a habit out of paying late, collection processes and systems
have never really been kind to the customers either. In the absence of proper customer data and history,
analysts and collection teams always saw rich dividends in applying a confrontational approach to the
collection activity. If the dunning was serious and strong enough, the chances of getting paid were higher.
However, the long-term impact of such an approach was not foreseen. Sometimes customers with good
credit backgrounds and a history of on-time payments faced harrowing experiences because of one-off late
payments.
Today, however the tactics have changed to a more strategic prioritization and correspondence to
customers focusing more on maintain the customer relationship instead of ‘just getting paid.’
A Proactive Approach
Today, collections management stresses on understanding customer payment habits to create a win-win. In
the proactive approach, collections teams are increasingly analyzing past data to weed out strategies and
tactics which are no longer delivering results, and modifying them to align with the goal of collecting more
and reducing the average collection period. This has been a major turnaround since collection teams no
longer wait for invoices to be due, but are able to determine the right time for reaching out to each
customer.
Prioritizing Customer Follow-Ups to Maximize Returns

As collections management continues to evolve into a data science, the biggest impact is on how collection
teams plan their follow-up in the modern world. While it is mostly the norm to start following up before the
payment is actually due, collections teams are spending a significant amount of time in figuring out which
customer requires an earlier follow-up compared to the others. Teams are looking at multiple factors
including payment history, indicators of delinquency and credit risk scores. Combined with easy access to
enterprise-grade predictive analytics, teams turn data into well-informed decisions. This helps teams achieve
better results from the collections effort by controlling delinquency and bad-debt.
Multiple Modes of Communication in Use

Phone calls could be more effective at the level of an individual collection. However, with hundreds of
thousands of invoices requiring customer contact, the tide has changed to favor other technological
solutions. The idea that modern businesses have tested and adopted widely is the use of multiple channels
for connecting with the customer like emails. This is mainly because:
• Emailing the customers whose due dates are approaching; payment reminders often proves to be
more effective.
• From a scalability point-of-view, emails take less time, which means that more customers could be
reached in a shorter time.
• Emails are less intrusive and usually very well-received in a business context as a polite way to
remind customers who otherwise have a decent payment record.
• Emails are also a good way to share invoices, Proof of Deliveries (PODs), deal sheets and other
requirement documents.
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• Emails also make it easy to keep a track of all correspondence and communication with the
customer.
Therefore, using a mix of emails and phone calls on an as-needed basis is the most effective way to
approach customers.
Collection Policies Driven by Regulatory Compliance

Collections policies have undergone tremendous change over the years. Business policy and reform have led
to laws which restrict irregular and abusive procedures followed by collections teams. For example, Fair Debt
Collections Practices Act strictly specifies prohibited conducts such as repeated calling, misrepresentation,
seeking unjustified amounts, abusive language, among others, during a collections process. More than ever
before, companies are bound to consider their customers’ expectations when designing internal policy,
strategy and tactics around collections.
Strategic Relationship with Customers

With increasing competition, thousands of retailers and millions of products, end customers have more
choices and the purchase decision-making has become an increasingly complex process. Retailers selling
directly to consumers are often able to win customer loyalty simply with attractive pricing, affordable quality
and a decent range of options. However, the business-to-business environment requires much more time
and effort. Customers value relationships which extend beyond product quality and price competitiveness.
The simple thought that loyal customers are least likely to default is driving a sea of change in how finance
teams are approaching the collections challenge.
2.2 Correspondence Automation

Since, correspondence is the cornerstone of the collections process, it is imperative to have an automation
solution that caters to this particular requirement. Ideally, a correspondence automation system should
handle and maintain multiple correspondence templates that are needed by the collection analysts. In
addition, these systems should perform correspondence activity across mediums including print and mail,
email and fax, as well as keep track of all phone-based collection touchpoints. It should also be capable of
completely automating manual work involved in creating correspondence, selecting accounts and contacts
and sending out emails or dunning notices. In short, correspondence automation should enable the
collections team to:
• Connect seamlessly with all the data-streams available to SAP Collections Management
• Use the data from different data-streams to create letter templates as well as complete packages
which send different documents as attachments with the correspondence
• Use the different variables available within SAP Collections Management as well as additional
variables to define the rules for correspondence
• Create advanced strategies for correspondence by combining multiple rules
• Assign user-created packages for execution based on defined strategies and rules
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2.3 Three Pillars of Customer Correspondence
THREE PILLARS OF
CUSTOMER CORRESPONDENCE
CONTEXT TIME ACCOUNT TYPE
Email, Fax or Mail Customers

Call Customers
While deciphering the best strategies to select the mode and style of correspondence that would suit a
particular customer during the collections process, it is imperative to analyze the following three points to
choose the most effective solution:
Context
Before sending an email/fax/mail or calling the customer, the collectors should ask themselves once why are
they sending or what they are going to ask about on the call. It is necessary to understand the major
objective behind any correspondence activity. Is it about pro-actively reminding customers for upcoming
payments or about solving any ad hoc queries of the customer, the collection analyst need to have a clear
picture before initiating the correspondence activity. Based on this context, the analyst might need to
change their tone/style of communication.
Time
Time is of extreme essence in collections domain. It is essential to note the time at which the
correspondence is happening. Is it before the due date or after the due date? The language and the content
of the message will definitely change based on this constraint. For example, if the collection analyst is
sending an email as gentle reminder for upcoming open invoices then, the tone of the conversation can be
direct but light without pressurizing the customer to make a payment whereas if the collection analyst is
sending an email for third-past due reminder then, the tone of the email should be strict and direct
emphasizing on the impact of any further negligence on credit utilization or previous orders.
Account Type
With the change in the correspondence approach over the years from ‘just-getting-paid-focused’ to
‘customer-relationship-focused’, the line of communication for different value accounts has also changed.
For key account large customers, the style of communication is quite polite and thankful. Also, a little lenient
as compared to that for other accounts. For fast-paying customers, the language of emails is polite yet direct
whereas for slow-paying customers, it is demanding with stricter implications in case of failure to pay.
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Moreover, the frequency of emails also differs. Where for fast-paying customers it is about 7-15-20 days
whereas for slow-paying customers, it is about 5-10-14 days.
Based on these 3 pillars of customer correspondence, effective email templates can be created to deliver the
best results i.e. adding dollars to the bottom-line faster without hampering the customer relationship in the
long run.
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3. The 11 Unbeatable Collection Templates
3.1 Pro-active payment reminders

Best-practices:
• Be polite – remember that this is just a pro-active reminder; do not assume that the customer will
default
• Clearly specify the invoices and the due-dates
• Urge them to make a payment with their earliest A/P run
• Share options for easy payment methods through an EIPP portal
Specify the date by

which the amount is due
Explain the main motive of writing the email
Provide an easy
method for payment
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3.2 Early-payment discount reminders

Best-practices:
• Clearly call out the offer – a discount on early payment

• Clearly spell out the date by which payment must be made
• Detail any invoices with the actual amounts to be paid – this clears any confusion in buyers manually
calculating final amounts
• Urge them to make a payment with their earliest A/P run
• Provide convenient payment options
Context of the email
Specify the date by which the amount is due
Call-to-action
Provide an easy
method for payment
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3.3 First past-due reminders

Best-practices:
• Clarify whether the customer has received any previous invoice copies
• Call out the invoices for which payment has been delayed – specify the actual date
• Ask the customer to reach out to customer serivce in case of any issues
• Offer convenient payment options
Specify the invoice

number
Specify the date by

which the amount is due
Provide an easy method for payment
Pro-actively answer/attach reference for

any further questions as well
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3.4 Second past-due reminder

Best-practices:
• Clearly inform about the delay in payment

• Call out the email as a ‘second’ past-due reminder
• Remind the customer to make a payment at their earliest possible
• Offer the option of making a payment commitment through your EIPP portal
• Attach the original invoices to avoid further to and fro in requesting invoice information
Specify the invoice number
Specify the
past due date
Provide an easy
method for payment Provide alternate options
Pro-actively answer/attach reference for

any further questions as well
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3.5 Third past-due reminder

Best-practices:
• Call out the possible outcomes for further non-receipt

• Drop any non-essential courtesy or flowery language
• Remind the customer to make a payment at their earliest possible
Stipulate the outcome of any further negligence on the first line itself
Specify the invoice

number as well as the
past due date
Provide an easy
method for payment Provide alternate options
Pro-actively answer/attach reference

for any further questions as well
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3.6 Suspension of credit

Best-practices:
• Inform about discontinued credit

• Clearly specify the reason for discontinuation of credit to the account
• Call out the total value of outstanding or past-due invoices
• Offer reaching out directly to a customer service representative as the first option
Specify the action that has been taken and the reason for it
Give a contact number
Pro-actively answer/attach reference for any

further questions as well
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3.7 Default on payment commitment

Best-practices:
• Use this as a polite reminder about the unfulfilled payment commitment

• Include the details of the invoice, amount and promised payment date
• Ask the customer to contact a customer service representative for any help in facilitating the
payment
Specify the invoice number, due amount as well as

the payment commitment due date
Give a contact number

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3.8 Escalation notice

Best-practices:
• Clearly specify that this is an extra-ordinary circumstance in which the recipient is being reached out
to
• Highlight all the information they need to help process the payment
• Use this template sparingly to avoid diluting its impact and value
Highlight all the important

details like invoice, due date and
due amount
Be polite, yet straight-forward
Provide an easy
method for payment

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3.9 Collecting from key accounts

Best-practices:
• Appreciate the relationship with the customer

• Be polite and helpful with any additional details they may need in processing the payment
• Attach the original invoices so that all information is available in one place

due amount
Be polite and helpful

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3.10 Collecting from Slow-paying customers

Best-practices:
• Share all information required in a single place

• Be up-front about the implications of continued delay in payments
• Offer support in answering any questions

due amount
Be strict and direct
Pro-actively answer/attach reference for any further questions as well
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3.11 Collecting from Fast-paying customers

Best-practices:
• Be polite – these customers have always paid you on-time

• Offer the benefit of doubt and ask them to reach out to customer service for any help
• Attach the original invoices so that all information is available in one place

due amount
Provide contact number to

maintain customer relationship
Pro-actively answer/attach reference for any further questions as well
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4. The Role of Technology in Collections

Advances in technology have enabled collections teams to increase operational efficiencies and eliminate
some of the redundant, manual tasks that drain collections productivity. This has had a direct impact on DSO
with companies noticing a reduction anywhere in the range of 5% to 10%.
Most of the technology deployed for collections management is focused on solving at least one of the
functional areas of the collections management process.
Electronic Invoice Presentment and Payment
Collections
Management Automated and Dynamic Customer Prioritization
process
Automated Customer Correspondence
Figure 1: Functional Areas in Collections Management
In this section we discuss some of the technologies which are already helping collections teams perform
better.
Electronic Invoice Presentment And Payment

As discussed earlier, customers not receiving invoices is one of the biggest reasons for delayed payments.
The switch to electronic invoice presentment and payment (EIPP) helps collections teams ensure timely
invoice delivery. Additionally, electronic delivery also provides the ability to keep a close watch to monitor if
the invoice has actually been viewed or accessed by the buyer. Another aspect which helps in speeding up
payments is the ability for buyers to pay electronically through a single system. Most EIPP systems accept
customer payments through ACH and credit cards. At the same time, invoice and payment security remain
top concerns for collections teams when evaluating EIPP solutions. However, a bigger concern, which
directly impacts the effectiveness of such solutions, is the rate at which buyers in a particular industry or
market are willing to adopt these electronic means of invoice delivery and payment.
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Automated and Dynamic Customer Prioritization

Prioritizing collections is one of the main challenges faced by organizations today. Collections management
solutions that allow segmentation of customers and have the ability to assign some collections strategy to
each of these segments are a necessity to handle the growing business volume. Such solutions eliminate the
manual work required by the analyst to create a daily or a weekly collections items list. The technology is
capable of working in the background to evaluate factors including size of the customer, past payment
history and behavior and other aspects to create a collections list. Team leaders benefit from such systems
which guide the collections teams with recommended strategies and actions based on the particular
category to which the customer is attached. In the end, the biggest benefits are clearly two-fold –
standardization of collections activities based on customer categories and the elimination of the manual
work required to prepare the collections worklist.
Automated Customer Correspondence

By establishing a single system for all customer correspondence, technology is able to empower collections
teams to perform both strategic and tactical correspondence activity with customers without spending
disproportional amounts of time.
By creating ready-to-use templates out of the most commonly used communication across customer
accounts, it is possible to significantly reduce the amount of time taken to correspond with customers. Such
systems make it possible for an analyst to select a group of ten customers in a batch, for example, and send
an email to them via a single template which collects information relevant to each in their individual
correspondences A major load could be removed from collections analysts by enabling these systems to
respond to the ad hoc information requests from customers. Copies of due-invoices and other necessary
documentation are automatically attached to the main correspondence.
Collections management technology is creating a huge impact on how collections teams work today. Most
teams adopting new technologies deliver better collections outcomes with fewer resource while addressing
the overall agenda of their organizations to maintain positive customer experiences without impacting cash
flow and working capital.
To learn more about technology solutions used by leading companies for credit and collections
management, visit www.highradius.com
29
5. About HighRadius
HighRadius is a Fintech enterprise Software-as-a-Service (SaaS) company. The HighRadius™ Integrated
Receivables platform optimizes cash flow through automation of receivables and payments processes across
credit, collections, cash application, deductions, electronic billing and payment processing.
Powered by Rivana™ Artificial Intelligence Engine and Freda™ Virtual Assistant for Credit-to-Cash,
HighRadius Integrated Receivables enables teams to leverage machine learning for accurate decision making
and future outcomes. The radiusOne™ B2B payment network allows suppliers to digitally connect with
buyers, closing the loop from supplier receivable processes to buyer payable processes.
HighRadius solutions have a proven track record of optimizing cash flow, reducing days sales outstanding
(DSO) and bad debt, and increasing operational efficiency so that companies may achieve strong ROI in just a
few months. To learn more, please visit https://www.highradius.com/.
HighRadius’ Integrated Receivables Platform
Integrated Receivables is a solution to optimize accounts receivable operations by integrating all receivable and
payment modules to work as a unified business process. At the core of the Integrated Receivables platform are
solutions for credit, collections, deductions, cash application, electronic billing and payment processing –
covering the entire gamut from credit-to-cash. The HighRadiusTM Integrated Receivables platform is a stand-out
as it enables every credit and A/R operation to execute real-time from a unified platform with an end goal of
lower DSO, reduced bad-debt, faster dispute resolution and improved efficiency, accuracy for cash application,
billing and payment processing.
HighRadiusTM Integrated Receivables leverages RivanaTM Artificial Intelligence for Accounts Receivable to convert
receivables faster and more effectively using machine learning for accurate decision making across credit and
receivable processes. The Integrated Receivables platform also enables suppliers to digitally connect with buyers
via the radiusOneTM network, closing the loop from the supplier A/R process to the buyer A/P process.
30
Corporate Headquarters http://www.highradius.com/
HighRadius Corporation info@highradius.com
11451 Katy Freeway, Suite 650
Houston, Texas 77079
(281) 968-4473
31

11 Collections Email Templates To Double Productivity of Operations

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11 Collections Email Templates To Double Productivity of Operations

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11 Collections Email Templates to Double

1. The State of Collections Management

1.2 The Standard Collections Process

Create Customer Log Track Payment Set Reminders Receivable

Performance Define Collection

FIGURE 1: DESC RIBING ALL THE P R OCESSES OF COLLECT IONS

1. Create Prioritized Worklist

2. Send and Log Customer Correspondence

3. Tracking Payment Commitments and Setting Up Reminders and Follow-Ups

5. Defining Customer Strategies and Rules

1.3 The Major Bottlenecks of the Collections Process

1. Lack of Collectors to Deal with The Growing Volume of Due Invoices:

2. Prioritizing Customers for Collection Activity

3. Identifying The Right Contact at A Customer Organization

4. Applying The Right Collections Approach for Each Customer

5. Collections Operating in A Silo from Other Receivables Processes

• Sales terms, deal sheets or discounts offered by sales teams

6. Ad-Hoc Information Requests from Customers:

7. Measuring The Effectiveness Of Collections Operations

Lack of Collectors to Deal with Growing Volume of Due Invoices

Prioritizing Customers for Collection Activity

Identifying the Right Contact at A Customer Organization

Applying the Right Collections Approach for Each Customer

Collections Operating in A Silo from Other Receivables Processes

Ad-hoc Information Requests from Customers:

Measuring the Effectiveness of Collections Operations

1.4 Solutions to Common Collection Challenges

Figure 5: Types of Collections Management Systems

Receivables Master Data Management Systems

Dunning Activity Management Systems

Correspondence Automation Systems

Integrated Collections Management Systems

2. A Strategic Look at Collections Correspondence

2.1 The Correspondence Approach – Before vs. Today

Evolution of Collections Management Practices

• Reactive Approach • Proactive Approach

Evolution of Collections Management Practices

More Phone Calls Each Day Means Less Outstanding Amount

Collection Policies Created to Protect The Interest of Suppliers

A Confrontational and Persistent Approach Towards Customers

Prioritizing Customer Follow-Ups to Maximize Returns

Multiple Modes of Communication in Use

Collection Policies Driven by Regulatory Compliance

Strategic Relationship with Customers

2.2 Correspondence Automation

2.3 Three Pillars of Customer Correspondence

CONTEXT TIME ACCOUNT TYPE

Email, Fax or Mail Customers

3. The 11 Unbeatable Collection Templates

3.1 Pro-active payment reminders

Specify the date by

Explain the main motive of writing the email

3.2 Early-payment discount reminders

• Clearly call out the offer – a discount on early payment

Context of the email

Specify the date by which the amount is due

3.3 First past-due reminders

Specify the invoice

Specify the date by

Provide an easy method for payment

Pro-actively answer/attach reference for

3.4 Second past-due reminder