Poll: Do you charge interest or penalty fees for late payments? Autor de la hebra: ProZ.com Staff
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This forum topic is for the discussion of the poll question "Do you charge interest or penalty fees for late payments?".
View the poll results »
| | | | | Other (not usually) | Jan 18, 2019 |
In over 30 years I’ve had a few late payments (I’m dealing with one right now) but I had only 5 non-payment issues (4 agencies and 1 direct client): some solved, with the help of a lawyer for 2 of them (the amounts were too small for the remaining); all the legal fees were paid by the debtors (interest fees included).
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Obviously it says I will on my invoices, but the only time the interest would ever amount to more than pennies is where the client isn't going to pay at all.
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I think it would be like trying to push jelly up a hill. And not worth the trouble.
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neilmac
España
Local time: 06:40
español al inglés
+ ...
I try to understand my clients and their situations. The smaller ones sometimes have cash flow problems; for example, one of them just paid me 50% of a bill I issued at the end of September; I'm not sure if it's the first or second 50%, but they always pay up in the end. Then there are research institutions and universities, whose accounting is bound to the tax year and the funds available, which means they may sometimes take several months to pay, but they always do so in the end.
I'm awa... See more I try to understand my clients and their situations. The smaller ones sometimes have cash flow problems; for example, one of them just paid me 50% of a bill I issued at the end of September; I'm not sure if it's the first or second 50%, but they always pay up in the end. Then there are research institutions and universities, whose accounting is bound to the tax year and the funds available, which means they may sometimes take several months to pay, but they always do so in the end.
I'm aware that badgering them isn't going to help, and that they will pay up in due course. It used to be more of a nuisance for me in the early days, but over the years I've gotten used to it. As the old tourist ad said: "Spain is different"... ▲ Collapse
| | | | Jan Truper 
Alemania
Local time: 06:40
inglés al alemán
I don't work for clients that pay late.
| | | | | EU's Late Payment Directive | Jan 18, 2019 |
Never enforced interest or penalty fees for late payments yet, but the provision is present in all my invoices as legally required in France, and as per the Late Payment Directive by the EU:
https://ec.europa.eu/growth/smes/support/late-payment_en
Among the main provisions:
- Automatic entitlement to interest for late payment and €40 minimu... See more Never enforced interest or penalty fees for late payments yet, but the provision is present in all my invoices as legally required in France, and as per the Late Payment Directive by the EU:
https://ec.europa.eu/growth/smes/support/late-payment_en
Among the main provisions:
- Automatic entitlement to interest for late payment and €40 minimum as compensation for recovery costs.
- Statutory interest of at least 8% above the European Central Bank’s reference rate.
Note: These come into play without having to send any reminder to the client, simply after the due date lapses. If you are working in the EU, mentioning such legal provisions are a deterring factor against late payment practices. They has served well so far.
All my invoices mention:
- Late payment penalties: interest rate applied by the ECB increased by 10 points of percentage
- Flat rate for late payment recovery costs: €40 (article D.441-5 of the French Code of Commerce)
[Edited at 2019-01-19 02:44 GMT] ▲ Collapse
| | | | | In France, yes, absolutely! | Jan 18, 2019 |
In over 25 years working as a translator, whether the client is small or huge, getting paid by the deadline for payment is hard. Sending out a reminder invoice with the 40€ penalty and the interest added on usually has the effect of making a forgetful client pay up. However, one example at the moment, is a company who paid the 30% upfront bang on time and that I had to chase for the balance, which they'd put into their system on a 60 days end of month programme. They had agreed clearly to payi... See more In over 25 years working as a translator, whether the client is small or huge, getting paid by the deadline for payment is hard. Sending out a reminder invoice with the 40€ penalty and the interest added on usually has the effect of making a forgetful client pay up. However, one example at the moment, is a company who paid the 30% upfront bang on time and that I had to chase for the balance, which they'd put into their system on a 60 days end of month programme. They had agreed clearly to paying me upon receipt off my invoice. They paid up, but were late and it caused me prejudice. I added the penalty and interest which they had no choice about and which they agreed to pay (which made me smile, as like I have just pointed out, it's compulsory). But I'm having to chase them for that too, which is adding insult to injury. ▲ Collapse
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Robert Forstag
Estados Unidos
Local time: 00:40
español al inglés
+ ...
| Seems counterproductive | Jan 18, 2019 |
It seems that proposing a late payment fee when a project is being negotiated would likely drive most potential clients away.
What I do instead in order to protect myself are the following:
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I stress the importance of the payment deadline (with phrasing along the lines of: “Payment due on or before [date], which is a firm deadline.”)
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In the case of agencies, I usually work with companies with a “good” Blue Board rating (and therefore an o... See more It seems that proposing a late payment fee when a project is being negotiated would likely drive most potential clients away.
What I do instead in order to protect myself are the following:
1.
I stress the importance of the payment deadline (with phrasing along the lines of: “Payment due on or before [date], which is a firm deadline.”)
2.
In the case of agencies, I usually work with companies with a “good” Blue Board rating (and therefore an online presence and reputation to protect).
3.
In the case of direct clients, I insist on upfront payment (for small jobs) and a combination of down payment and delivery-upon-payment for larger jobs.
These procedures have generally worked well for me. ▲ Collapse
| | | | Mario Freitas
Brasil
Local time: 02:40
Miembro 2014
inglés al portugués
+ ...
Unfortunately, this does not exist in our market. I wish it did, but it doesn't.
Anyway, it doesn't make a difference to me really. If any client delays a payment for more than 10 days, that will be the last service I'll provide to them.
[Edited at 2019-01-18 18:18 GMT]
| | | | DZiW (X)
Ucrania
inglés al ruso
+ ...
| Working with local direct clients | Jan 18, 2019 |
It's me who makes my own rules in my biz:
1) I charge extra for late payments and
2) I ask new, unreliable and persistent non-payers for prepayment--or refuse their offers.
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