Credit control and payment management policy
At Agile Collective, we believe that maintaining accurate financial records and clear agreements with our clients supports the transparency and trust vital to our cooperative. This policy ensures we manage invoicing and payments in a fair, professional, and proportionate manner to protect our long-term sustainability.
Our guiding principles for credit control mirror our internal values:
- Act in good faith and work to be constructive and honest in all financial dealings.
- Seek fair solutions that balance the needs of our clients with the financial health of the cooperative.
- Keep it simple, ensuring our processes remain practical and proportionate to our size.
Financial record keeping
To support a culture of clarity, we maintain up-to-date records for all client and supplier accounts. This includes:
- Retaining copies of contracts, purchase orders, and agreed pricing.
- Recording any variations or revised payment arrangements as they happen.
- Regularly reconciling our accounts to ensure everything is accurate and transparent.
Paying our subcontractors
Agile Collective regularly works with freelancers and subcontractors. We want to be the kind of organisation that others can trust and rely on, so we hold ourselves to the same standards of timely, transparent payment that we ask of our own clients.
Payment terms
We will pay subcontractor invoices within 30 days of receipt of a valid invoice. Payment is never conditional on us having first received payment from our own client — we do not operate "pay when paid" arrangements, as these unfairly transfer financial risk down the supply chain.
To help us process invoices promptly, we ask subcontractors to include:
- A clear description of work completed and the period it covers.
- Reference to the relevant project or purchase order, where applicable.
- Bank details and any VAT information.
Late payment
If we fail to pay a valid, undisputed invoice on time, subcontractors are entitled to claim statutory interest and fixed compensation under the Late Payment of Commercial Debts (Interest) Act 1998, just as we may exercise those rights with our own clients. We take this seriously: if a payment has been missed in error, please contact us and we will resolve it promptly.
Disputed invoices
If we have a concern about an invoice — for example, where the work differs from what was agreed — we will raise it in writing within 30 days of receipt. We will not withhold payment on undisputed portions of an invoice simply because one element is under review.
If a dispute cannot be resolved informally, we will follow the same internal review and ADR approach described in the Handling disputed invoices section above.
Suspension of work
If we have failed to pay an undisputed invoice and the matter is not resolved within a reasonable time, a subcontractor is entitled to suspend work by giving us at least 7 days' written notice. We will not treat this as a breach of contract, and any time lost to a justified suspension will not count against agreed delivery timelines.
Pre-engagement and clear terms
Before we begin work, we aim to balance financial responsibility with trust. For larger projects or where risks are identified, we may review payment histories or require staged/upfront payments.
We communicate our payment terms clearly at the start of every engagement to minimise misunderstandings. All contracts will specify:
- Fees, pricing structures, and when invoices will be issued.
- Payment deadlines (typically 30 days from the invoice date).
- Our right to recover statutory interest and compensation for late payments.
Monitoring and follow-up
Healthy finances allow us to continue delivering high-quality work. We actively monitor overdue invoices and patterns of late payment, but we always aim to resolve issues constructively to maintain positive relationships. Our approach to follow-up includes:
- A courtesy reminder shortly before or on the due date.
- A polite follow-up shortly after the due date.
- A formal written reminder if the payment remains outstanding.
Handling disputed invoices
If a client disputes an invoice, we seek to resolve the matter promptly through open discussion, much like our internal conflict resolution process.
Internal review process
If an informal chat doesn't resolve the issue, we will carry out a prompt internal review to identify if the problem is a billing error, a misunderstanding of scope, or a service concern. We will:
- Verify that pricing and terms match the original contract.
- Correct any administrative errors immediately.
- Discuss reasonable adjustments or revised payment plans where appropriate.
- Confirm any agreed resolution in writing.
If the dispute remains unresolved, we may suggest Alternative Dispute Resolution (ADR), such as mediation, to find a simple and effective way forward without legal escalation.
Late payments and recovery
Where a payment is overdue and no valid dispute exists, we may exercise our rights under the Late Payment of Commercial Debts (Interest) Act 1998. This allows us to charge statutory interest and claim fixed compensation for recovery costs. We will always exercise these rights proportionately.
Escalation and legal action
Legal proceedings are always a last resort. We only move to formal recovery steps when reasonable attempts at resolution have been made and the debt is not genuinely disputed.
Stage 1 – Formal demand
We will issue a Letter Before Action identifying the debt and providing a clear deadline (typically 14 days).
Stage 2 – Further action
If no resolution is reached, we may take steps proportionate to the amount owed, such as issuing a claim through the County Court or engaging a debt recovery service.
For undisputed debts exceeding the statutory threshold (currently £750), we may consider a statutory demand against a limited company, though this is a serious step and never used as a routine tactic. The cooperative will always consider the reputational impact and cost-effectiveness before proceeding with any legal action.
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