Collecting bills efficiently, on-time and with a minimum of bad debts is essential in any business. Bill collection, unlike collecting payments at the point of sale, involves granting the buyer credit until they have paid the invoice / the bill, so the first tasks in bill collection are to decide what is the company's credit policy and what are the payment terms. And then to collect the payments efficiently whilst at the same time making it easy for the payer to pay.
Dimensions of Bill Collection
Source: J&W Associates Copyright© 2011
The main dimensions of bill collection, shown in the figure above, are 1) managing the accounts receivable policy and processes, 2) exploiting the potential for major efficiency and working capital improvements from e-invoicing, 3) using the most effective combination of payment systems for one-off and recurring payments, and 4) developing dedicated bill collection programmes for three sectors - large companies/organisations, SMEs and consumers.