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How to prevent and mitigate late international payments.

What happens when your international customer hasn’t paid you? The situation can be much more complicated than dealing with a domestic customer. Differences in language, culture and payment systems can all contribute to payment delays or non-payment. There are steps you can take to prevent these risks before they happen and important methods you can use to mitigate loss if a delay occurs.

Conduct a credit check

Before doing business with a new customer, it's recommended to conduct a credit check to assess their financial stability and creditworthiness. This can help you identify any potential payment risks and adjust your payment terms accordingly. There are online credit check services available to provide you with the information you need to make an informed decision. If you have credit insurance, your provider can assist you as well.

Establish clear payment terms

When doing business overseas it's crucial to establish clear payment terms in your contract. This includes a due date, method of payment, and any fees that may apply. Make sure these terms are communicated clearly and in writing to avoid any misunderstandings or disputes down the line. Also, ensure your customer has received the necessary documents and information they need to pay you on time.

Communicate effectively

When working with international customers, it's essential to provide clear and timely communication. This includes being aware of language and cultural differences that may impact communication. Make sure to provide all necessary information in writing to avoid any misunderstandings. If a customer hasn't paid, you should reach out to them and try to understand why. Regardless of the reason, try to work with them on a resolution. Be sure to document all conversations and agreements to avoid any misunderstandings or disputes down the road.

Send a reminder

If you haven't heard from the customer, sending a friendly reminder can often prompt payment. Perhaps the invoice was lost in their office, or they had staffing changes. Be professional, and non-confrontational, and include all the relevant information for the payment, or resend the import documents in case they have been misplaced. You may also want to consider sending multiple reminders at regular intervals to keep the payment on top of their mind.

Offer a payment plan

If the customer is experiencing financial difficulties, or perhaps their country has been hit by a significant natural disaster, increased inflation or interest, or other factors that make payment of any sort difficult, consider offering a payment plan. This can be a win-win for both parties, as it allows the customer to pay off the debt in manageable quantities while ensuring you eventually get paid. Be sure to put the terms of the payment plan in writing and include any late fees that may apply if a payment is missed.

Find an alternative

Sometimes financial situations are not easy to resolve or are caused by situations beyond everyone’s control. Try finding another solution or getting creative. Perhaps the customer could return the product to you if it is available and still financially beneficial for you. See if they have other products you can take in trade or use to fulfill another sales commitment you have to another party. It is rare to intentionally not be paid by a customer or to not find an amicable solution.

Use Arbitration

If a settlement cannot be reached and your contracts note the sale was per ISF Trade Rules there are specific details for arbitration (a process where each side presents its case to a tribunal for a final and binding decision). This can be a time-consuming and costly process, so it's not something to be taken lightly. However, if the debt is significant, and all other options have been exhausted, it may be necessary to pursue this action to protect your business's financial interests.


Working internationally can often come with challenges and payment issues are some of the most difficult. By using the steps above, you can often prevent payment issues or have a higher chance of recovering past-due debt. Remain professional, include relevant information, and communicate clearly, and you will be more likely to achieve a positive outcome.


Contact AgCultured Consulting for information on international transactions.



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