Payment on due date: a cash flow risk that the law regulates, without eliminating it
In France, payment terms between businesses are regulated. The Economic Modernization Act (LME) sets a default payment period of 30 days from receipt of the goods or completion of the service, and a contractual limit of 60 days net from the invoice date or 45 days from the end of the month if this term is specified in the contract.
But a legal framework alone is not enough to ensure timely payment. As of early 2026, the average payment delay between businesses stood at 18.9 days, its highest level in twelve years, compared with 17.3 days a year earlier¹. The Banque de France estimates that if large companies paid their suppliers on time, SMEs would have recovered 13 billion euros in cash flow in 2024 alone².
Every day a payment is late effectively amounts to a free line of credit extended to the customer. For a finance department, the issue is therefore not just a matter of knowing its rights in the event of nonpayment, but of designing a process that automatically reduces the risk of late payments.
Choosing the right payment methods to ensure payment on due date
The first factor in transforming the due date payment cycle is the choice of payment methods offered to the customer. These directly influence the likelihood that an invoice will be paid on the scheduled date.
Bank transfers remain the standard in B2B transactions, but they depend entirely on the payer’s initiative: there is nothing to prevent a customer from delaying the transfer by a few days, whether intentionally or simply by oversight.
With Pay by Bank, the merchant takes the initiative: they initiate a pre-filled transfer, which the customer simply needs to confirm through their online banking portal. It’s a reliable alternative that ensures payment is made on time without depending on the payer’s goodwill.
For one-time payments, a credit card payment link sent directly when the payment is due reduces friction: the customer can pay in just a few clicks.
Another option for recurring subscriptions (SaaS, service contracts) is the SEPA direct debit, which is particularly well-suited for monthly payments that are known in advance and recur every month.
This variety of payment methods makes it possible to tailor the payment channel to the customer’s profile rather than imposing a single method on the entire customer base.
Switching from a passive to an active payment on due date
Regardless of the payment methods selected, the key is to automate the tracking of due dates rather than discovering a late payment only when reconciling bank statements. In practical terms, this means identifying every invoice that has reached its due date as early as the day after the scheduled due date.
The most advanced companies segment their customer base based on payment profiles (history, amount, industry) and trigger tailored collection scenarios, for example:
- a friendly reminder on Day 1,
- a more firm email on Day 15,
- an alert sent to the sales representative or credit manager after 30 or 60 days.
This level of detail helps avoid two opposing pitfalls: treating a good payer with the same strictness as a customer in financial difficulty or letting a sensitive case slip through the cracks due to a lack of follow-up.
Automation helps structure the business relationship: it frees teams from routine tasks so they can focus on cases that require real judgment, such as a dispute, a request for payment deferral, or a strategic client facing cash flow difficulties.
When implemented effectively, this automation of collection efforts significantly reduces the average number of days past due and restores visibility into projected cash flow.
When a follow-up is no longer enough
Despite automation, some overdue payments are not always resolved through simple reminders.
In this case, the formal notice remains a key step before initiating legal proceedings. It may be followed, if necessary, by a payment order from the commercial court or by the involvement of a bailiff for older cases.
For companies facing recurring payment delays rather than isolated incidents, factoring is another option: selling receivables to a third party allows them to collect payment in advance, while transferring the risk and the collection timeline. It serves as an additional source of cash flow, particularly useful when payment on due date put a strain on working capital needs.
Electronic invoicing: digitizing the end-to-end process
All of the above measures can be implemented independently of one another. The electronic invoicing reform provides an opportunity to integrate them into a single workflow.
Effective September 1, 2026, all companies must be able to receive their invoices in a structured electronic format via a PDP. Issuing invoices in this format will become mandatory on the same date for large companies and mid-sized companies, and then on July 1, 2027, for small and medium-sized enterprises (SMEs) and microenterprises.
Beyond the regulatory requirement, this shift changes the nature of the data available on each invoice: the issue date, the receipt date, and, potentially, the payment date can now be tracked on a single platform. The starting point for a 30-, 45-, or 60-day payment term is no longer open to interpretation, which simplifies the automatic calculation of payment deadlines and any late fees.
Only 7% of companies reported being ready for this regulatory deadline in the spring of 2026³. This project, if planned well in advance, can also serve as the technical foundation for a fully automated payment process in the future, from invoice issuance to the reconciliation of payments received.
In summary…
Digitizing payment on due date processes involves integrating several key components: reliable invoicing, payment methods tailored to each customer, automated and segmented collection reminders, real-time reconciliation of payments received, and a clear escalation process when amicable resolution is no longer sufficient.
Taken individually, these practices already reduce delays. When integrated into a single platform, they transform a passive customer experience into a controlled cycle, from quote to payment.
Sources:
¹ Enquête Ifop/Arc, “Baromètre des retards de paiement” (2026)
² Banque de France, “Entreprises: les retards de paiement en nette hausse, la facturation électronique pourrait les réduire” (2026)
³ Altares, “Défaillances record, retards de paiement, facture électronique” (2026)
