Repayment Plan Agreement
A repayment plan agreement is a simple, friendly way to put a catch-up schedule in writing while keeping a customer relationship intact.
What's included
- Know when a lighter repayment plan fits better than a formal agreement
- Record the schedule clearly without heavy legal language
- Keep an acknowledgement of the balance owing
- Set a simple consequence for missed payments
- Understand when to escalate to a fuller document
6 min read
The template
This is a general, plain-language template for a catch-up plan where you want to keep things straightforward. Replace each [placeholder] as needed.
REPAYMENT PLAN To: [Customer name / company], ABN/ACN [number] From: [Your business], ABN [ABN] Date: [Date] Account [account/invoice numbers] is overdue by [$amount]. We've agreed the following plan to bring it up to date: Payment 1: [$amount] by [date] Payment 2: [$amount] by [date] Payment 3: [$amount] by [date] Please pay to [BSB/account], reference [reference]. By making the first payment you confirm the [$amount] is owing and that this plan replaces any earlier arrangement for this account. If a payment is missed, the full remaining balance falls due and we may need to take further steps to recover it. Thanks for working with us to sort this out. [Name, position, contact details]
How to use it
Use this when the relationship is worth protecting and the amount is modest. Keep the language warm but make sure two things are still in there: an acknowledgement of the balance, and a clear consequence if the plan is missed. Confirm the plan in writing (email is fine) and keep the reply. For a tighter, signed instrument — larger balances, shakier customers — step up to the formal instalment or payment arrangement templates instead. To set realistic dates and any interest, the free Payment Terms Generator is a handy starting point.
Not legal advice
This is a general template and general information only — not legal advice. A friendly tone does not change the fact that you are documenting a debt. Have it reviewed by a lawyer if anything about the account is contentious or significant.
Tips
- A repayment plan suits modest balances and good relationships.
- Keep an acknowledgement of the amount owing.
- State plainly what happens if a payment is missed.
- Step up to a formal agreement for larger or riskier accounts.
FAQ
Does this need to be signed?
A signature is ideal, but written agreement — such as the customer confirming by email and making the first payment — can also evidence the plan. This is general information, not legal advice.
When should I use the formal version instead?
For larger sums, repeat offenders, or where you may need to enforce, use the instalment or payment arrangement template and consider a guarantee.
Can I still charge interest?
Only if your terms allow it. On a goodwill plan many creditors pause interest as an incentive — decide and say so up front.
Templates are a head start — not legal advice
Customise to your business and have important documents reviewed. Need to recover a debt? We can help.