Receivables management is a central component of finance in any company. It covers all measures used to systematically manage, monitor, and enforce outstanding receivables against customers—from invoicing through to judicial enforcement. 

The receivables management process – explained step by step

As soon as a product has been delivered or a service has been provided, receivables management begins with the first and most important step: delivering the invoice. This can happen in various ways:

• In person

• By email

• Usually by post

The payment term is generally stated on the invoice. If no deadline has been agreed, companies automatically enter default 30 days after receipt of the invoice. For private individuals, default must be triggered by a reminder notice after 30 days have elapsed.

Default: What does this mean for debtors?

As soon as the debtor is in payment default—whether a company or a private individual— default interest accrues. In addition, the company may charge the customer reminder fees. A fee of EUR 2.50 per reminder is permitted.

If the final reminder remains unsuccessful, receivables management must resort to legally stronger measures.

Further steps in receivables management

1. Apply for a payment order

   Companies can independently apply for a payment order at the competent local court in order to enforce their claim in court.

2. Engage a debt collection agency or attorney

   Alternatively, the claim can be handed over to a debt collection agency or an attorney for professional follow-up.

3. Sale of receivables (factoring)

   Selling the outstanding receivable is another option. However, this approach is associated with high costs and should be carefully evaluated.

Why end-to-end receivables management is important

Comprehensive receivables management is important not only from a financial perspective, but also from an accounting and legal perspective. If a receivable is, for example, written off, it must be documented which recovery measures were taken. An arbitrary write-off without proof of enforcement can cause issues during a tax audit or with auditors.

KELVERBILL – your end-to-end receivables management solution

If you are looking for a professional solution for handling your entire receivables management, KELVERBILL offers a comprehensive service package:

• Invoice dispatch

• Automated dunning

• Debt collection

• Court proceedings & enforcement

• International receivables recovery

With KELVERBILL, you can ensure that all legal and accounting requirements are met — and that your liquidity is secured at all times.

Effective receivables management is not a nice-to-have, but a business imperative. It protects against bad debt, secures cash flow, and ensures transparent accounting. Companies that structure this process systematically and professionally benefit in the long term from better predictability and greater financial stability.