What is dunning?
Dunning is the process of sending customers a planned sequence of reminders to pay overdue invoices, starting politely and becoming firmer as the debt ages. Each step, usually an email or letter with a copy of the invoice, goes out at a set number of days past due, and later steps may add late fees or warn of suspension.
Also calleddunning processpayment remindersdunning letters
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- Steps
- Reminders by days past due
- Also used for
- Failed subscription payments
- Category
- AP, AR and payments
How dunning works
A dunning schedule sets the steps and timings: for example a friendly reminder at the due date, a firmer one a week or two later, a final notice, then a phone call or handover to a collector. The wording, the channel and the contact change at each level. Subscription businesses also use dunning for failed card payments, retrying the card and asking the customer to update payment details before the account is suspended. Accounting systems such as Xero and QuickBooks send scheduled invoice reminders; receivables tools such as Kolleno, Monk and Stuut adjust timing and content by customer and stop reminders automatically when a payment, dispute or promise to pay is recorded.
Common questions
What is a dunning letter?+
A reminder that an invoice is overdue, stating the amount, the original due date and how to pay. Each letter in the sequence is firmer than the last, and the final one usually says what will happen if payment is not made.
What is the difference between dunning and collections?+
Dunning is the scheduled reminder sequence. Collections is the wider work of getting paid, including prioritising accounts, calls, dispute handling and escalation to an agency or court.
What is dunning in subscription billing?+
Handling failed recurring payments: retrying the card on a schedule, emailing the customer to update payment details, and suspending or cancelling the subscription if payment still fails.
Software used for dunning
KollenoAI-prioritised collections, payments and reconciliation.Profile →
MonkAI-native receivables with automated collections and cash application.Profile →
StuutAI agents running collections, cash application and disputes end to end.Profile →
Paraglide AIAI agents handling invoice chasing and reconciliation.Profile →
XeroCloud accounting for small businesses with a large app ecosystem.Profile →
Intuit QuickBooksSmall business accounting covering books, invoicing and payroll.Profile →Part of Accountio’s accounting technology coverage · Glossary
