Debt Collection for Technology and Digital Businesses
As with many sectors, technology and digital services companies can find their invoices being paid late, or not at all.
More about Debt Services for Technology and Digital
Our experienced debt collection solicitors have a wealth of knowledge in debt recovery law, and we understand the difficulties businesses face when dealing with unpaid debts. Our debt recovery solicitors provide bespoke solutions to suit your individual needs and can assist you at every stage of the debt recovery process, from initial letters of demand to legal proceedings.
Why debt recovery matters?
Many tech companies are small start ups or SMEs, and it’s crucial in the first year to two years, and afterwards, to build the lasting relationships that can be the cornerstone of a growth strategy. Rightly, company directors can be cautious about putting pressure on these relationships in circumstances where payment is delayed. But there are dangers where this interrupts cash flow and impacts on capital reserves.
On the other hand, you could be supplying services to a start-up, which may have struggled to gain momentum and be experiencing difficulty with its own cash flow. In this instance, you may find recovery difficult; fundamentally, if a company does not have the funds to pay you, you may find you will simply throw good money after bad.
Early action can make the difference between being paid and simply spending money only to claim in an insolvency process, so it’s worth being wary of allowing multiple invoices to go unpaid in the name of building a good relationship.
One of our clients was offered equity in the debtor company, in lieu of actual payment for our client’s work in developing an app for a chain of gym business. The client opted not to accept this offer, and we subsequently issued proceedings and then received settled of the claim in a short time frame.
Why debt recovery matters?
Many tech companies are small start ups or SMEs, and it’s crucial in the first year to two years, and afterwards, to build the lasting relationships that can be the cornerstone of a growth strategy. Rightly, company directors can be cautious about putting pressure on these relationships in circumstances where payment is delayed. But there are dangers where this interrupts cash flow and impacts on capital reserves.
On the other hand, you could be supplying services to a start-up, which may have struggled to gain momentum and be experiencing difficulty with its own cash flow. In this instance, you may find recovery difficult; fundamentally, if a company does not have the funds to pay you, you may find you will simply throw good money after bad.
Early action can make the difference between being paid and simply spending money only to claim in an insolvency process, so it’s worth being wary of allowing multiple invoices to go unpaid in the name of building a good relationship.
One of our clients was offered equity in the debtor company, in lieu of actual payment for our client’s work in developing an app for a chain of gym business. The client opted not to accept this offer, and we subsequently issued proceedings and then received settled of the claim in a short time frame.
What legal steps can a tech firm take if their client does not pay?
If the debt has not been recovered in pre-action correspondence, a court claim can be issued, with a view to obtaining a County Court Judgment, generally known as a CCJ, or a High Court Judgment.
A CCJ is an order by the Court that the debt must be paid, and allow a creditor to take enforcement action if the debt is not paid.
To obtain a CCJ, the creditor must issue a claim at court. The claim includes details of what is outstanding, and is served on the defendant, or debtor. The defendant has various options including:
make payment of the debt, including interest claimed, any solicitor’s costs claimed and the court fee. Of course, having issued the claim, this is the most ideal solution.
Defend the claim
The Defendant can lodge a dispute, which can then be resolved through mediation or litigation
Admit the claim and request time to pay (if the debtor is an individual)
Ignore the claim – the creditor can request default judgment and proceed with enforcement.
Early action can be crucial, so if you have outstanding invoices, please contact us to discuss how you can maximize your recovery and maintain healthy cash flow.
What legal steps can a tech firm take if their client does not pay?
If the debt has not been recovered in pre-action correspondence, a court claim can be issued, with a view to obtaining a County Court Judgment, generally known as a CCJ, or a High Court Judgment.
A CCJ is an order by the Court that the debt must be paid, and allow a creditor to take enforcement action if the debt is not paid.
To obtain a CCJ, the creditor must issue a claim at court. The claim includes details of what is outstanding, and is served on the defendant, or debtor. The defendant has various options including:
make payment of the debt, including interest claimed, any solicitor’s costs claimed and the court fee. Of course, having issued the claim, this is the most ideal solution.
Defend the claim
The Defendant can lodge a dispute, which can then be resolved through mediation or litigation
Admit the claim and request time to pay (if the debtor is an individual)
Ignore the claim – the creditor can request default judgment and proceed with enforcement.
Early action can be crucial, so if you have outstanding invoices, please contact us to discuss how you can maximize your recovery and maintain healthy cash flow.
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