Chasing money is the job nobody schedules. The work is done, the invoice is out, and then a fortnight passes while you decide whether today is the day you send the awkward email. AI does not make the customer pay faster by magic. What it does is remove the friction that stops the reminder ever being written.
Why do polite chase emails work better than angry ones?
The government's late payment consultation response reports that late payment affects more than 1.5 million businesses each year, at an average of around £17,000 per affected business. That scale tells you something useful: your unpaid invoice is rarely personal. It is usually a queue.
So write for the queue. Invoice number in the subject line. Amount and due date in the first sentence. One ask. Payment link if you have one.
What can AI actually do in a late payment chase?
The honest split is that AI handles the writing and the watching, and you handle the judgement. A model given the invoice number, the delivery date, the agreed terms, and the last three messages will produce a better first draft in four seconds than most people produce in fifteen minutes, because it is not embarrassed. That is the entire advantage.
Where this connects to the rest of the admin stack matters. The same set of invoice records that drives an automated invoice chasing sequence also feeds a rolling cash flow forecast, so the work of structuring your data pays twice.
When is a UK invoice legally late?
That default matters for your chase ladder. If your invoice says nothing about terms, your first genuinely enforceable chase does not begin until day 31. If it says "payment due within 14 days" and the customer accepted it, day 15 is fair game.
Put the date on the invoice. Not "net 30". An actual date, in words the accounts inbox can act on without arithmetic.
What should the first reminder say?
A prompt that produces this reliably:
Write a payment reminder email. Invoice 1042, £2,400 including VAT, issued 12 June, due 12 July, for the bathroom refit at 14 Alma Road. Contact is Priya in accounts. Assume it was an oversight. Under 90 words, UK English, no apology, no exclamation marks, one clear ask, include the bank details line at the end.
The output you want looks roughly like this:
Subject: Invoice 1042 due 12 July, £2,400
Hi Priya,
Just flagging invoice 1042 for the bathroom refit at 14 Alma Road. It was due on 12 July and I can't see it against the account yet.
The total is £2,400 including VAT. Bank details are on the invoice, and I can resend the PDF if it has gone astray.
Anything you need from me to get it into the next payment run, let me know.
That is the whole first reminder. Resist the urge to add context.
What does a second, firmer chase look like?
Send it seven to ten days after the first. Change the ask, not the tone:
Subject: Invoice 1042, £2,400, now 21 days overdue
Hi Priya,
Following up on invoice 1042, £2,400 including VAT, due 12 July.
Could you confirm which payment run it is scheduled for? If there's a query holding it up I'd rather sort that now than keep emailing.
Two sentences of substance. The line about a query is doing real work: it surfaces disputes you did not know existed, which is often the actual reason an invoice has stalled.
When should you mention statutory interest and compensation?
The figures are worth knowing precisely. GOV.UK states the statutory interest rate for business to business transactions is 8% plus the Bank of England base rate. Its own worked example uses a £1,000 debt at an illustrative 0.5% base rate, giving £85 a year, roughly 23p a day, so £11.50 after 50 days. Interest alone is rarely the lever.
The fixed compensation is more pointed. Section 5A of the Late Payment of Commercial Debts (Interest) Act 1998 sets a fixed sum on top of the interest: £40 for a debt under £1,000, £70 for a debt of £1,000 or more but under £10,000, and £100 for a debt of £10,000 or more. Reasonable recovery costs above that fixed sum can also be claimed.
Wording that stays civil:
I'd rather not, but I should mention that commercial debts of this age carry a statutory right to interest at 8% above base plus fixed compensation of £70 under the 1998 Act. I'm not applying that today. I would like a payment date this week.
Naming the right while declining to use it is the most effective version of this message.
How do you use AI without sounding like a robot?
Three constraints that do most of the work:
- Word ceiling. Under 100 words for reminders one and two. Length reads as anxiety.
- Ban the softeners. Tell it not to open with "I hope this email finds you well" or "I just wanted to check in". Those phrases signal a bulk send.
- One ask per email. Two asks halve your chance of getting either.
Then read it aloud. If it sounds like something you would not say on the phone, it is wrong. This is the same discipline that makes AI drafted quotes and proposals land: the model supplies the structure, you supply the voice.
What should you never automate?
There is a second category worth guarding: the client who has already told you they are struggling. An automated reminder landing on someone who explained last week that their own customer defaulted is the fastest way to lose an account you might have kept with a payment plan. Any AI setup needs a suppression flag that a human can set, and it needs to be respected without exception.
For trades and field businesses where the same person quotes, delivers, and invoices, this matters more than in an office. Sector specific detail on how that plays out for plumbers, electricians, and other trades is worth reading before you wire anything up.
How do you set the whole chase ladder up in an afternoon?
A workable sequence:
- Pull the overdue invoice list each morning, filtered by days past due.
- Bucket into 1 to 7, 8 to 21, and 22 plus.
- Draft the matching template for each invoice, populated with the real invoice number, amount, job description, and contact name.
- Auto send buckets one and two. Hold bucket three for approval.
- Log every send against the invoice so the next draft knows what was already said.
Step five is the one people skip, and it is the one that stops your third email repeating your first.
Does chasing politely actually protect the relationship?
The regulatory direction is moving the same way. The government has brought forward the Small Business Protections Bill, which proposes a 60 day cap on payment terms for large firms paying smaller suppliers and mandatory statutory interest in commercial contracts. Check the current status before relying on it, because a bill is not law and the detail can change. The assumption that chasing is rude is quietly being retired, and firms that already chase consistently will have less to change.
The honest trade off with automating any of this: you will send more reminders than you do now, and a small number of clients will find that annoying. In exchange you stop losing invoices to embarrassment. For most UK small businesses carrying thousands of pounds of overdue work at any given moment, that trade is not close.
Start with the first reminder template. Send it on the day the invoice falls due, every time, to everyone. Consistency beats cleverness, and it is the only part of this you have to get right.
Using AI to Chase Late Payments Politely (UK Templates) — FAQ
Is it legal to charge interest on a late invoice in the UK?
Yes. Under the Late Payment of Commercial Debts (Interest) Act 1998, a business supplying another business can claim statutory interest on a qualifying commercial debt. GOV.UK states the rate for business to business transactions is 8% plus the Bank of England base rate. You do not need a clause in your contract to claim it, although proposed reforms would require statutory interest to be written into commercial contracts in future. You can choose not to charge it, and many small firms waive it as a goodwill gesture once payment lands. The right to claim still gives your chase emails weight, because the customer knows the clock is running whether you invoke it or not.
How much fixed compensation can I claim on a late invoice?
Section 5A of the Late Payment of Commercial Debts (Interest) Act 1998 sets a fixed sum on top of statutory interest, banded by the size of the debt. For a debt under £1,000 the sum is £40. For a debt of £1,000 or more but under £10,000 it is £70. For a debt of £10,000 or more it is £100. This is per qualifying debt, so several unpaid invoices can each carry their own fixed sum. You can also claim reasonable debt recovery costs above that fixed sum if the fixed sum does not cover what recovery actually cost you.
When does a UK invoice officially count as late?
GOV.UK guidance says that if you do not agree a payment date, the law treats payment as late 30 days after the customer receives the invoice, or 30 days after delivery of the goods or service, whichever is later. If you do agree a date, it must usually fall within 30 days for public authorities or 60 days for business transactions. A longer period than 60 days is possible between businesses, but it has to be fair to both sides. Setting the date explicitly on the invoice removes the argument entirely, which is why most disputes start with a vague purchase order rather than a difficult customer.
Will AI write chase emails that sound robotic?
It will if you feed it nothing. A generic prompt produces generic filler, and finance teams recognise it instantly. The fix is to give the model the specific facts of the job: what was delivered, on what date, who signed it off, the invoice number, the agreed terms, and how the last conversation went. Then constrain the tone in the prompt itself, for example short sentences, no apologies, one clear ask, under 120 words. Draft with AI, then read the result out loud before sending. If a sentence would embarrass you in a phone call, cut it.
Should I automate the whole chase sequence?
Automate the first two reminders and keep human judgement for everything after that. The early stages are pure admin: a due date passes, a template fires, a payment link goes out. Nobody needs to think about that. The later stages carry commercial risk, because a firm email to a client mid renewal or a supplier you rely on can cost more than the invoice. A sensible rule is that AI drafts every message and sends the low risk ones, while anything mentioning interest, suspension of work, or legal escalation waits for a person to approve it.
Does chasing politely actually get invoices paid faster?
Politeness is not the active ingredient. Consistency is. A reminder that arrives on a predictable schedule, references a specific invoice number, and makes one clear request gets processed because it is easy to process. Tone matters because it decides whether the person in accounts helps you or files you under difficult. The practical benefit of AI here is that it removes the reason chases get skipped, which is that writing them is tedious and slightly awkward. When the draft is already waiting, the chase goes out on day one instead of day nineteen.
