Late Payment Is Intolerable
late payment
Late payment causes loss of productivity in the society because resources have to be pulled on the mitigation actions.

We should live with dignity and pay on time whatever is legally due. Do financial planning wisely. Spend frugally to accumulate some saving to cater for periodically due payments. We have to be accountable in everything.

Do not give any chance to others for their late payment. Do due diligence to get their financial strength before signing the contract and remind them one day before the payment is due. For overdue payment, do not accept any personal excuse, including claimed demise of family member, because that is not our problem. Do whatever it takes as per the agreement to stop supplying goods and service to the defaulter. If the defaulter cannot pay the smaller amount now, then he surely cannot pay the bigger accumulated amount later. Terminating the agreement early will help both parties. People with a certain ethnicity tend to have higher rate of late payment with all types of personal excuse.

Take a look on an example. A tenant's rental payment is overdue. The owner wants to exercise his right to terminate the tenancy as per the agreement. Then the tenant promises to pay at a certain date and begs the owner not to terminate the tenancy. The owner should not take it because the tenant may still default the payment on the promised date. In one case, the owner wants to give a grace period with a condition, in which he withdraws the grace from another aspect and exercise his right to increase rental rate as per the agreement. Then tenant does not agree with the condition and does not intend to compensate for the loss of the owner due to late payment. Thus the owner will just end the tenancy without further discussion as the tenant does not accept the conditional grace. A meaningful negotiation cannot go on if everything only benefits one side.

Posted: 2016-11-23 by Ong Seng Aun.
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