How to Offer Early Payment Discounts

Early payment discounts can unlock faster cash flow, all while strengthening client relationships since you’re giving them more flexible payment terms. Here's how to structure them so both sides win.


1. Pick a discount that makes sense for you

Try this: Start with a modest incentive like 1-3% for payments within 5-10 days (if your default is Net 30). That’s often enough to encourage early payment without eating into your margins. Just make sure it aligns with the value of faster cash in your business.
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Read more “How To Decide the Percentage for Early Payment Discounts” →

2. Tie discounts to clear timeframes
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Try this: Define a specific payment window, like “2% if paid within 10 days.” Vague terms like “early” lead to confusion. Specific deadlines set the expectation and make it easy for your client’s finance team to comply.

3. Communicate it on the invoice (and in advance)

Try this: Include the discount terms in the invoice, and mention that this is an offer the client might find on the invoice from time to time, while setting up the agreement. Ask if the person receiving the invoice is the one who has the authority to decide whether or not to pay early, or if someone else should also be included in the sending list.

4. Test it on reliable clients first

Try this: Start with a client who already pays reliably, by adding a small discount, and see how they respond. This builds confidence in your process and helps you refine the terms before rolling it out more broadly.

5. Use a platform that supports flexibility

Try this: Offer dynamic discounts via a tool like Cheque. You can set your terms, send the invoice, and let the client choose to pay early for a discount, or not. You stay in control, they get flexibility, and the whole process is transparent and easy for you to manage.

Why it works
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Done right, early payment discounts:
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• Improve cash flow without adding debt
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• Give clients optional flexibility
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• Create predictable revenue patterns
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• Help reduce time spent chasing invoices