Time Really Is Money: Telecom Invoice Late Fees

Paying a vendor and getting nothing of value in return makes no business sense, but that’s essentially what your enterprise is doing every time it’s forced to remit a late payment fee to a telecommunications company. Like banks today, telecom companies have a reputation for making a significant portion of their income from various fees that they hope go mostly under the customer’s radar. If you were to conduct a quick, informal phone bill audit at your company, you might be shocked to see what telecom late fees and penalties have cost over time.

When you consider that telecommunications companies provide services that take place at virtually the speed of light, it’s ironic that telecom billing can be so slow and archaic. Paper invoices sent by snail mail are antithetical to the image of “ultra-techness” that telco providers cultivate, but that’s the accounts payable reality that many telecom customers still deal with. It’s common for the payment clock to start ticking from the date that a telecom vendor generates an invoice, meaning that days can pass before your telecom services bill gets out the vendor’s door, through the postal system and into your mailroom. Tack on some time for internal mail routing, and a nominal 30-day payment window can quickly collapse to 20 days. For telecom invoices, which are complex and notoriously difficult to process, that’s not necessarily a lot of time.

The fee or penalty charged by telecom companies for each late payment varies, but a charge of 1.5 percent of the overdue amount per month is common. Some quick math will tell you that works out to annual interest of 18 percent – at that rate, you might be better off paying phone bills by credit card! Telecom companies that charge a minimum late fee or that slap on a flat late payment penalty could be raking in an even higher percentage than that.

Telecom consultants can help stem the hemorrhage of late fees in two ways. First, a good telecom consulting firm can negotiate telecom contracts with terms more favorable to the customer, including greater leeway on payment time and a degree of leniency for the occasional late payment. Second, telecom consultants can actually manage telecom invoices for you. An experienced, dedicated company like Telanalysis can focus on remitting accurate, timely payments to your telecom providers in a way that your in-house AP staff doesn’t have time for. To consult with Telanalysis about our full range of services, and how we can save your company money, call us today at 866-300-6999.

This entry was posted in Telecom Billing. Bookmark the permalink.