How to recover an unpaid invoice in South Africa.
A customer hasn’t paid and the due date is long gone. Here’s the practical order of steps South African businesses can follow, from the first friendly reminder to handing the debt over.
By Kyle Zorger, founder of ARS Financial · Updated · 6 min read
In short
- Check your paperwork, then send a polite reminder soon after the due date.
- Phone the person who approves payments and get a specific date.
- Confirm every promise in writing, and pause further credit.
- Send a formal letter of demand with a clear deadline.
- Offer a written payment plan if they genuinely can’t pay in one go.
- If nothing works, hand it to a recovery firm or an attorney well before the debt prescribes, usually three years.
Step by step
- 01
Check your paperwork
Gather the invoice, proof of delivery (delivery note, signed job card or emails), the accepted quote or purchase order, and your terms and conditions. Make sure the invoice is correct and went to the right person.
- 02
Send a friendly reminder
A few days after the due date, send a short, polite reminder with the invoice attached. Many late payments are oversights, so assume good faith at this stage.
- 03
Phone the person who pays
Speak to whoever approves payments, not just the person who placed the order. Ask whether there’s a query holding things up, and get a specific payment date.
- 04
Put promises in writing
After every call, email a short note confirming what was agreed: the amount and the date. It keeps everyone honest and builds your paper trail.
- 05
Pause further credit
Hold new orders or work on account until the overdue invoice is paid. Continuing to supply a customer who isn’t paying usually makes the debt bigger.
- 06
Send a letter of demand
If the debt is still unpaid, send a formal letter of demand: the amount, the invoices, a clear deadline (often 7 to 14 days) and what will happen if they don’t pay.
- 07
Agree a payment plan if needed
If the customer genuinely can’t pay in full, agree instalments in writing, ideally as a signed acknowledgement of debt. An acknowledgement also restarts the prescription clock.
- 08
Hand it over
If none of this works, hand the debt to a recovery firm or an attorney. Don’t wait too long: most ordinary debts prescribe after three years.
Your options for handing it over
- A recovery firm, such as ARS Financial, chases the debt for you, often on a no-recovery, no-fee basis, so there’s nothing to pay upfront.
- An attorney can issue a summons and take the matter to court. Magistrates’ courts hear claims of up to R400,000 (district courts up to R200,000, regional courts from there up to R400,000); larger claims go to the High Court.
- The small claims court handles claims of up to R20,000, but only individuals can bring a claim there. A company or close corporation can’t use it to recover its debts.
Legal action costs money and time, so weigh the size of the debt against the cost. For many business debts, structured recovery and a payment plan get the money in without going to court.
Prevent it next time
- Agree clear payment terms before you start the work, and get them accepted in writing.
- Take a deposit on larger jobs.
- Invoice promptly and accurately, with the payment date and banking details on the invoice.
- Follow up the day an invoice falls due, not weeks later.
- Check a new customer’s track record before giving them credit.
Frequently asked questions
No. Only individuals can bring a claim in the small claims court, and the limit is R20,000. A company or close corporation has to use the magistrates’ court or a higher court, usually through an attorney.
Most ordinary debts prescribe after three years from when they fell due. The clock restarts if the debtor acknowledges the debt, for example by signing an acknowledgement of debt or making a part-payment.
Generally not on credit. Pausing further work or orders until the overdue invoice is settled protects you from a bigger loss and gives the customer a strong reason to pay.
Once your own reminders, calls and written follow-ups haven’t worked, typically when an invoice is 30 to 60 days overdue. A firm working on a no-recovery, no-fee basis costs nothing upfront.
Hand us the invoice. We’ll take it from here.
No recovery, no fee, and a live view of every step in your client portal. Based in Cape Town, working nationwide.