Debt Recovery for Small Businesses: A Practical Compliance Checklist (EU/US)
For small businesses, overdue invoices can choke cash flow. But collections are a YMYL activity: how you contact customers has legal, financial, and reputational impact. This practical checklist shows how to recover invoices the right way—lawful basis documented, data protected, tone professional—so you keep revenue and brand trust. It reflects how EcomTrade24 runs email-only, GDPR-aware outreach across the EU/US (informational, not legal advice).
1) Establish a Clear Lawful Basis
- Confirm a legitimate interest or contractual necessity for contacting the customer about payment.
- Limit processing to what is necessary: order ID, amount, references, and contact details.
- Maintain a record of the basis and when it was assessed.
2) Verify Identity & Data Accuracy
- Match the invoice to the correct customer email; avoid misdirected messages.
- Ensure amounts, currency, taxes (VAT), and due dates are accurate.
- Attach or link to the invoice PDF; avoid sending full card data or sensitive info.
3) Apply Data Minimization & Retention
- Share only what the recipient needs to resolve payment.
- Set retention windows for collection records; don’t keep data indefinitely.
- Restrict internal access to “need to know”.
4) Use Email-Only, Professional Communication
- Respectful tone; no threats, no shaming, no public posts.
- Template flow: Initial notice → gentle reminder → final friendly request.
- Include a secure payment link and a clear dispute path.
5) Localize and Respect Jurisdictions
For EU, UK, and US recipients, align with local consumer and privacy frameworks and keep language clear and non-misleading. Multilingual emails increase response rates and reduce confusion.
6) Document an Audit Trail
- Timestamp each email; store message IDs and content.
- Record outcomes (paid, returned, disputed) and any refunds or adjustments.
- If escalating, keep all correspondence for counsel.
7) Prepare Dispute Handling
- Offer a straightforward way to contest or clarify the charge.
- Pause outreach while a dispute is reviewed; respond with evidence calmly.
- Propose resolutions: partial settlement, return authorization, or payment plan.
8) Internal Roles & Separation of Duties
Finance drafts notices; support answers product questions; legal reviews templates. This keeps communications accurate and consistent.
9) KPIs for Continuous Improvement
- Days to first payment after notice
- Reply rate per email step
- Dispute-to-resolution ratio
- Repeat customer rate after settlement
10) When to Involve a Partner
If volume is rising, jurisdictions vary, or your team is stretched, partner with a specialist. EcomTrade24 operates discreet, email-only workflows that protect your reputation and help you get paid.