Invoice Payment Term Made Clear – Payment Due Upon Receipt

How about getting paid instantly?

What if you get your payment as soon as your client receives the invoice?

Getting paid almost seems like nailing jelly to the wall, especially when it comes to freelancers and small businesses.

You finish your work on time, send invoice but probably have to wait for ages to get paid. It happens most of the time and is actually frustrating. However, there is one foolproof way to get paid on time. Next time when you set your payment terms before starting a project, make sure you label your invoice “Due Upon Receipt”. This is a perfect payment method for the one-time client and one-time job.  

Payment due upon receipt simply means paying for the goods or services immediately or once the client receives the invoice.

Get your business going with this payment method!
Get your business going with this payment method!

If you think this payment term can be beneficial for your business, then go ahead and know everything about it:

What Does ‘Due Upon Receipt’ Mean?

The term ‘Due Upon Receipt’ means the client has to make payment as soon as the invoice is received. As soon as possible or instant payment also means the client can make the payment by the next business day.

However, thanks to the modern online payment technology, as now it is possible to get paid in a jiffy. With online payment gateways and digital payment means, you can ideally get paid on the same day or even instantly.

Payment Due Upon Receipt Template

Payment due upon Receipt Template
Payment Due Upon Receipt Template

It is a great move to start adding ‘payment due upon receipt’ on every invoice you send and increase your chances of getting paid faster. But it may not be feasible for every job.

When to mark your invoice, ‘payment due upon receipt’?

Now after understanding this payment term, any business would certainly be excited to embrace this option, isn’t it?  Who wouldn’t love to get paid fast! Unfortunately, due upon receipt invoices doesn’t work best for every line of work. 

Any new client who requires only one-time job or if you realise the client is not as such interested to repeat business then this type of invoicing term is ideal. 

For works like website designing, mobile app development, logo design, due upon receipt is a feasible choice.

Due upon receipt
Keep your finance management as easy as ABC no matter what the project is!

Pros of Due Upon Receipt

One of the biggest advantages of this invoicing term is quite evident and that’s faster payment. You can expect payment for your work done within 24 to 48 hours while with online banking it’s just a matter of minutes. So, ultimately you are assured with smooth cash flow.

Now if you are working as a freelancer or even small business, you might have a lot on the plate and tend to forget to check with the payment sent against invoice. This can be risky for your budding business. Adding the label ‘due on receipt’ can lessen your burden and effortlessly help you to receive payments on time.   

Looking through hundreds of emails and documents to identify pending invoices is really an uphill struggle. Instant payment option saves all your time and effort. Online invoicing software can make your task more hassle-free.

Cons of Due Upon Receipt

Yes, this invoicing term looks so beneficial but it comes with no guarantee. It doesn’t assure you that your client will pay within the next business day. Sometimes the clients themselves are waiting for their source of income, only if they get paid, they can make your payment. So in such situations, there is no choice left rather than waiting.

Some clients also prefer to make payments after reviewing the work delivered. Generally, if they are satisfied with your work and if it meets their expectations then you might get paid as per terms or else suggestions. Modifications may delay your payment. 

If you are unsure of the client’s behavior, it is always wise to discuss about your payment terms beforehand. It is actually vital to inform your client beforehand about your expectation on immediate payment after the invoice sent as it prevents negative impact and disputes.

Are there any better payment terms than Due Upon Receipt?

It predominantly depends upon the type of business/service and client. Apart from Due Upon Receipt, many businesses, as well as freelancers, use the ‘Net D’ payment term. The letter “D” refers to the number of days. This is a payment term that allows the customers to pay their outstanding invoice within 10 days, 15 days, 30 days, 45 days, or 60 days. Since the client/business gives enough time to the customers to make the payment, late payment issues are likely reduced. Even customers find this payment term useful. 

Alternative payment terms
Payment terms that can keep your business afloat!

Net D will help to effectively manage your accounts by keeping you aware of the latest due date. 


Due upon receipt can certainly speed up payments but it has its downside too. As mentioned before, if you deal with one-off projects, this invoicing term is worth trying. However, first discuss your terms with your client and then label your invoices “Due Upon Receipt”.

Divya Mudliar
Divya Mudliar
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