Cancel or Withdraw a Customer's Credit Account • Letter Templates and Guides

How to write this letter:

1Inform the customer that payment is past due. State when it was due and indicate the amount.
2Inform the customer that you are canceling the credit account.
3Offer an alternative plan for your customer to make payments and continue to do business with you.
4Thank the customer for past business and express your good wishes for his or her future.


Explain your reasons for withdrawing the customer's credit option, using a courteous tone. You may want to maintain this customer's business, even if you must ask for cash payments from now on.

Example Letter #1


I have reviewed your account with Doe International and note that it is 90 days past due.

The payment of $500.00 you promised two months ago still has not been received. Consequently, I must inform you that I have closed your credit account with us.

Doe appreciates your doing business with us and hopes that we can continue on a cash basis while you resolve your delinquent balance. I hope we can continue to have good associations. I wish you well.

Example Letter #2


We are sorry to inform you that we must close your charge account with Doe Department Store because of a consistent record of late or missed payments. In 2018, your payments in February, May, and July were more than 15 days late, and payments in March and October were missed entirely.

Perhaps you are having temporary financial difficulties that have created the present situation. Because of your long relationship with our store, we prefer to resolve the problem with you directly, rather than refer the account to a collection agency. Please contact the customer service department at 555-5555 and speak with Jane Doe about arranging a new payment schedule.

We hope that we will be able to work together to correct this credit problem and restore the good relationship our store has had with you for so many years. Doe Department Store appreciates your patronage, and we look forward to serving you in the future.

Example Letter #3


Upon review of your accounts receivable file, I see no alternative but to suspend your credit line with us. Your balance has been more than 30% over your credit limit for 60 days, and we have not received a payment in that time.

While your credit privileges have been suspended until the account balance is brought within your credit limit, we will happily continue sales on a cash basis. In addition, our accounts receivable officer, John Doe, will be glad to help you design a workable payment plan to keep your balance manageable.

Your business has been very important to us, and we hope to continue our relationship well into the future. We wish you the very best during this difficult time.

Example Letter #4


It is with regret that we must inform you that we will no longer be able to ship supplies to you on credit. As a small company, we are unable to carry balances of over $1000 for more than 60 days.

However, we will continue to send you materials COD. We appreciate your business and hope we can continue to supply you with the products you need. If you have questions about this letter, please contact John Doe at 555-5555.

Write Your Letter Step-by-Step


Inform the customer that payment is past due. State when it was due and indicate the amount.

Example Sentences for Step 1

Example Phrases for Step 1