Overdue invoices cost calculator: what late-paying customers really cost you
See the financing cost and likely bad debt hiding in your debtor list, and how much extra you must sell to cover it.
Why debtors cost more than they look
An unpaid invoice is cash you do not have. If you fund the gap with an overdraft, loan or supplier credit, you pay for every day it stays unpaid. The older an invoice gets, the less likely it is to be paid. This calculator puts a shilling figure on both costs and shows how much extra business you must win just to make up the loss, using your profit margin.
How to cut the cost
- Send an ageing report every month and call the oldest balances first.
- Set credit limits and stop supply when a customer is over the limit.
- Agree payment terms in writing and invoice on the day of delivery.
- Follow up at 7, 14 and 30 days, not after 90.
Pair this with the break-even calculator and the loan repayment calculator. If debtors are out of control, read how to catch up late books.
Common questions
What is a debtor ageing report?
A list of every customer balance grouped by how long it has been unpaid, usually 0 to 30, 31 to 60, 61 to 90 and over 90 days.
What bad-debt share should I use?
Use your own history. If you do not know, start with 5 to 10% of invoices over 90 days and adjust.
Does the cost of borrowing apply if I use my own cash?
Yes as an opportunity cost, because that cash could be earning a return or paying down a loan.
Related calculators and guides
Turn overdue invoices into cash
We build the ageing report, set credit limits and run structured debt follow-up.
Ask for a Run quoteEstimates for guidance only, not tax advice. Rates were checked in October 2026 and can change. Confirm with KRA or a qualified professional.