Payment Plan Proposal Template

The template

Use this when a customer has signalled they cannot clear the balance at once but is willing to pay over time. Offer a plan that is realistic enough to be kept, with a defined end date.

Subject: Proposed payment arrangement — invoice [Invoice Number] ([Total Amount])

Dear [Customer Name],

Thank you for discussing the outstanding balance of [Total Amount] on invoice [Invoice Number]. I'm glad to set up a payment arrangement so this can be cleared in manageable steps.

Proposed plan:
  [Number] instalments of [Instalment Amount]
  First payment: [First Date]
  Then: [Frequency] until paid in full
  Final payment: [Final Date]
  Total: [Total Amount]

Each instalment can be paid by EFT to [Account Name] / BSB [BSB] / Account [Account Number], reference [Invoice Number].

If an instalment is missed and not rescheduled with me beforehand, the full remaining balance becomes payable and the account may be referred for recovery.

If this works, please reply to confirm and I'll treat the arrangement as agreed. If you'd prefer different amounts or dates, let me know and we'll find something workable.

Regards,
[Your Name]
[Your Business] | [Phone] | [Email]

How to use it

A good plan is one the customer can actually keep — over-ambitious instalments break in week two and cost you more time than they save. Anchor the proposal to what the customer indicated they can manage, but always give it a defined end date so the debt does not drift indefinitely. State plainly, once, what a missed instalment triggers (the balance falling due and possible referral); that clause is what keeps the arrangement disciplined without you having to re-negotiate at every step. Invite a counter-offer so the customer feels part of the solution rather than handed an ultimatum.

Make it stick

An arrangement only helps if it is honoured. Build in the elements that keep it on track.

• Realistic instalments — small enough to be kept, large enough to clear the debt.
• Fixed dates — specific calendar dates, not "monthly" in the abstract.
• A clear default clause — what happens if a payment is missed.
• Written confirmation — the customer's reply makes it a record.

What happens next

Diarise each instalment date and check it. A kept plan is a quiet success — let it run and thank the customer when it completes. If an instalment is missed without prior contact, invoke the default clause and move to a broken-promise follow-up. Where the customer simply cannot maintain even a modest plan, the account may ultimately need referral — you can refer a debt when in-house options are exhausted.