Write a polite overdue invoice reminder
A practical way to use AI for this job in a small business, with a prompt you can copy.
You've done the work, sent the invoice, and now it's 30 days overdue. Chasing money feels awkward, so you put it off, and your cash flow suffers.
The prompt
Write 3 invoice reminders for an overdue invoice: friendly (7 days overdue), firmer (21 days), final (35 days, mention next steps). Invoice: [number], amount: [amount], due: [date]. Polite, clear, no threats.
Replace everything in [square brackets] with your own details. Don't paste in anything you wouldn't want stored by the AI provider.
Steps
- Run the prompt.
- Save them as reminder templates in your accounting software.
- Turn on automatic reminders if your software has them.
- Call for anything over 35 days.
A worked example
A Perth electrician has three invoices over 30 days. He asks ChatGPT for three reminder emails: a friendly nudge at 7 days overdue, a firmer note at 21 days, and a final notice at 45 days that mentions next steps. He includes his payment terms and bank details placeholder.
He pastes them into Xero's invoice reminders so they go out automatically. The first friendly nudge gets two of the three invoices paid within a week. The third client rings to arrange a payment plan.
Where it goes wrong
AI reminders can be too soft ('no worries if you can't!') or too aggressive. Find the middle. Don't include threats you won't follow through on. And check the reminder schedule doesn't keep emailing someone who's already paid; reconcile your bank feed first.
Time saved
Chasing invoices manually can take 1 to 2 hours a month. Automated reminders cut that to checking a report. These are my estimates for a typical small business, not measured results.
What it costs (AUD)
Invoice reminders are built into Xero (plans up to A$107 a month for Comprehensive) and MYOB (Smart Invoice Reminders on Lite and above; MYOB Lite is A$315 a year after its intro offer). AUD, October 2026; check the vendor for current plans.
The free plans of ChatGPT, Claude and Gemini handle this fine. If you end up using AI every day, the paid plans are roughly: ChatGPT Plus approx. A$30 a month, Claude Pro approx. A$29 a month billed monthly (US$20, or about A$24 a month if you pay yearly), and Google AI Pro approx. A$33 a month through the App Store. Prices approx., October 2026. Some are billed in US dollars, so your bank may add a foreign transaction fee. Check the vendor's pricing page before you buy.
Australian notes
Invoices from GST-registered businesses need to meet the ATO's tax invoice requirements. Keep reminders factual and polite; harassing or threatening debtors can breach consumer law. Small debts can be pursued through your state's small claims tribunal if needed. Get advice before you threaten legal action.
Privacy: the Privacy Act and the Australian Privacy Principles (APPs) cover most businesses turning over more than $3 million, plus some smaller ones such as health providers. Even if you're under the threshold, treat customer details with care: strip names, phone numbers and addresses before you paste anything into an AI tool.
Want this to happen automatically? See the step-by-step guide on our sister site: How to set up an invoice reminder bot.
My verdict
Do this once and set it up in your accounting software.
Common questions
When should I send the first reminder?
A few days after the due date. Some businesses also send a friendly heads-up before it's due.
Should I charge late fees?
Only if they were agreed in your terms before the work started.
What if they still don't pay?
Call them. Then consider a formal letter of demand or small claims.
Do this today
Turn on invoice reminders in Xero or MYOB today, and paste in friendlier wording from the prompt.
More finance use cases
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- Categorise expenses from a bank export
- Compare supplier quotes
Next: Categorise expenses from a bank export · All finance · Want a bot to do this automatically? See bot setup guides.