Customer not paying your invoice in India: what to do

By Gaurav Gupta, Founder & CEO, GGA India

Last reviewed: 9 November 2026

Direct answer. Find out why the invoice is unpaid before you escalate; most are stuck in process or a dispute, not refused. Then climb the ladder: written follow-up, legal notice, the MSME ODR portal for micro and small suppliers, a commercial suit after mediation, Section 138 for a bounced cheque, and IBC only for defaults of ₹1 crore or more.

GGA India at a glance

GGA India Private Limited is a B2B revenue-realization firm, operating since 2002, headquartered in Gurugram.
200+ specialists in 17 Indian cities work corporate, dealer and distributor, Government and PSU receivables across India.
Success commission is based on cash actually received. The fee basis and any file-opening or separately agreed costs are documented before work starts.
Your customers pay you directly. GGA never receives or holds your money.
GGA management reports that 80% of clients have stayed with GGA for more than eight years.

What is probably going on

A legal notice fixes none of the three most common reasons an invoice is unpaid. An invoice with no stated reason has one of four causes:

Process-blocked. No GRN posted; a closed PO line; or the head-office GSTIN on goods sent to a plant in another state. Test: if the customer's ledger does not show the invoice booked, it is process-blocked.
Disputed. A plant head objected to quantity, rate or quality on a call, and nobody wrote it down. Test: if the invoice is booked but on hold after a user-side objection, it is disputed.
Promise-led. A payables clerk has said "next week" four times; nobody has asked for an amount, a date and a name. Test: if the invoice is booked, unblocked and unpaid past a promised date, it is promise-led.
Genuine credit risk. The customer's receipts have slowed and the promoter is choosing whom to pay. Test: if other suppliers report the same delay, it is.

The first three are the large majority. A notice over a missing GRN sends the file to the customer's legal team and creates a dispute.

The pattern behind it. An unpaid invoice is revenue sold but not collected, and the cause usually splits: inside, many hands touched the sale and none owns the receivable; outside, the customer's receipt, booking and payment steps each belong to a different person. GGA's answer is to be the Invoice Lifecycle Owner — one owner who takes the invoice from submission to cash through every step on both sides. Revenue realization for corporate customers sets out how.

Your options

Match the route to the cause; legal routes need a clean document set and a customer who can pay.

Exhibit 1: The escalation ladder for an unpaid B2B invoice in India

Option	When it works	Typical time	Cost	Effect on the relationship
Structured follow-up (statement, reconciliation, named customer-side owner)	Process-blocked and promise-led; most cases under 90 days	2–6 weeks	Staff time	Positive
Legal notice from an advocate	Customer silent; you need a demand on record	15–30 days for a response	Advocate fee	Strained, usually recoverable
MSME reference (Udyam-registered micro or small supplier)	45-day limit crossed; interest at 3× RBI bank rate, compounded monthly	Conciliation, then arbitration; 90 days by statute, often longer	Low	Formal; buyer's challenge needs 75% pre-deposit
Commercial suit, incl. summary suit (Order XXXVII CPC)	Written contract or liquidated debt of ₹3 lakh or more	Mediation up to 3 months (+2 by consent), then suit	Court and advocate fees	Ends the relationship
Section 138 complaint	Customer's cheque bounced; offence carries up to two years' imprisonment or a fine up to twice the cheque	Notice within 30 days of dishonour; 15 days to pay; complaint within one month after	Advocate fee	Ends the relationship
IBC Section 9 application	Undisputed default of ₹1 crore or more; debtor can pay but will not	Demand notice, 10 days to reply, Information Utility filing, NCLT	High	Ends it; penalty for frivolous filing

On IBC: since 2026 an operational creditor must file the debt with an Information Utility before Section 9; debtor silence counts as authentication. A plausible pre-existing dispute still defeats the application. IBC is a resolution process, not a collection tool.

What to do this week

Five checks give you the cause, the open routes and the time left.

Pull the document set: PO, delivery proof, GRN, tax invoice, emails. A missing piece is your job.
Exchange ledgers. A reconciliation shows in a day whether the invoice is booked, on hold or never received.
Get a name, an amount and a date from accounts payable; confirm by email the same day.
Check your position: Udyam category; whether you hold a cheque; whether the default crosses ₹1 crore.
Check limitation: a suit for the price of goods sold generally has three years from delivery or expiry of the credit period.

When to bring someone in

Bring in help at 90 days if you still cannot name the reason. Other signs: three promised dates passed; the approver gone; a legal notice about to go out on an uncertain document set.

What GGA would do

We reconcile first, then collect — and you decide every escalation. We don't touch the money your sales team sells. We collect the money nobody owns.

Days 1–3: validate the file and place it in one of the four causes. You receive: a one-page note with the cause, the gaps and the first route.
Week 1: reconcile. You receive: the agreed balance, undisputed money separated from claims.
Weeks 1–2: name the owners on both sides. You receive: the customer's releasing officer, a committed amount and a date, confirmed by email.
Weeks 2–4: clear the blocker, from a missing GRN to a rate objection. You receive: a weekly action log.
Month 2: escalation decision. If dates slip, we set out the route from Exhibit 1 with document readiness and the limitation date. You receive: an escalation note for your written decision.
By month 6: paid or classified as at risk or not collectable, reason evidenced. You receive: a monthly report.

For a publishing client, the same GGA team recovered 22.4% of the current book in four months against 2.8% of the legacy book in eight. Fees: an agreed scale by age, frozen when work starts; GST extra.

What we need from you

Four items give a first view.

To start

Invoice copy and the PO it was raised against
Your statement of account for this customer
The last reply from the customer, or the email trail
Udyam certificate, if you are a micro or small enterprise

To act

Proof of delivery or completion: signed challan, LR, e-way bill or completion report
GRN or SES number, or the customer's written acceptance
Contract, rate agreement or PO terms showing the credit period
Any balance confirmation the customer has signed
Bounced cheque and the bank's return memo, if there is one
Customer contacts: purchase, accounts payable and the user department

Missing some of these? Send what you have — telling you what is missing is part of the first reply.

How you stay in control

No legal notice or settlement happens without your written approval.

Your customer pays you directly. GGA never receives or holds your money.
Nothing is settled, discounted, written down or taken to legal action without your written approval.
GGA manages the communication with your customers; escalation steps are discussed with you.
One named GGA owner per account; monthly report to your CEO and CFO, a fortnightly review call, and an immediate flash report when a risk appears.
Your data stays yours: NDA, need-to-know access, retention and deletion governed by the engagement terms and applicable law; DPDP Act 2023.
Fees agreed in writing before work starts; six-month term, reviewed with you monthly.
You see every legal notice in draft, with the reason it is the right step now, before it goes.
Contact above the customer's accounts payable team is an escalation step, discussed with you first.

Send us one unpaid invoice. Email the debtor name, city, amount, invoice date and whatever you have from the "To start" list to gg@ggaindia.co.in. Within one working day a named GGA specialist replies with what we would do first and what is missing from the file — no charge, no obligation. For a whole book, ask for a complimentary Receivables Position Review.

A different situation? Foreign company owed money by an Indian business → India Desk · Indian exporter owed by an overseas buyer → Global Receivables Desk

Frequently asked questions

Every month of delay lowers the collection rate.

How long should I wait before taking action on an unpaid invoice?

In the first week after the due date. GGA's benchmark: over 95% collected up to three months, 85–90% at three to six, 65–70% at six to twelve. Descriptive, not a forecast.

Can I file on MSME Samadhaan?

No. Samadhaan stopped taking new references on 15 October 2025. New cases go to the MSME ODR portal (odr.msme.gov.in), then your state's Facilitation Council. Medium enterprises and pure traders are excluded.

Is a summary suit faster, and do I need mediation first?

A summary suit suits a debt under a written contract, bill of exchange or guarantee; without leave to defend, you get judgment. For ₹3 lakh or more, Section 12A mediation comes first (held mandatory by the Supreme Court); its time is excluded from limitation.

If GGA works my unpaid invoice, who decides on a legal notice or a settlement?

You do. GGA recommends the route with its evidence; nothing is settled, discounted or sent as a legal notice without your written approval.

Sources

Every legal statement above traces to one of these.

This page summarises the position as at 9 November 2026. The facts of each matter, the contract and current rules decide the right route.