Answers for merchants using PaidTerms

PaidTerms lets New Zealand B2B businesses offer instalments on invoices, so customers can pay over time instead of all at once.

It plugs into how you already invoice, through Xero or directly, and handles the instalment scheduling, collection, and reconciliation for you.

You can apply from the PaidTerms website or book a call with the team. We'll ask a few questions about your business, invoicing volume, and typical order sizes.

Once approved, you'll get access to the merchant app where you can start offering instalments straight away.

No. You keep invoicing the way you already do. PaidTerms sits alongside your existing process. You simply send a PaidTerms payment link or connect your Xero invoices, and the instalment option appears for your customer.

Most merchant applications are reviewed within one to two business days. Some applications need a short call if we need more detail on your business or trading history.

There's no upfront cost to create a merchant account. PaidTerms charges a fee per transaction. See the Fees & Pricing section below for details.

Yes. Offering an instalment option is entirely up to you invoice by invoice or customer by customer. Nothing is forced on your existing customer relationships.

Once connected, PaidTerms reads your outstanding Xero invoices and lets you turn any of them into an instalment plan without entering anything twice.

As instalments are paid, PaidTerms automatically reconciles the payments back against the original Xero invoice.

No changes are required to your chart of accounts. PaidTerms reconciles against your existing invoices and payment accounts as they're already set up in Xero.

Yes. You can send PaidTerms payment links or invoices directly to customers without a Xero connection. The integration is an optional convenience layer, not a requirement.

PaidTerms connects to Xero using Xero's official OAuth integration and only requests the permissions needed to read invoices and write payment reconciliations. We don't store your Xero login details.

Purchasing power is the maximum instalment balance a specific customer is approved for at any one time, effectively their available credit limit within PaidTerms.

It determines the largest invoice (or combination of open invoices) that customer can put on an instalment plan.

You can still send the invoice. The customer can pay any amount upfront to bring the instalment portion within their limit, or you can request a limit review before sending the order.

Please get in touch with us if you would like us to review a customer's limit.

Yes. As a customer pays down an active instalment plan, their available purchasing power is freed up again automatically, up to their approved limit.

Yes. If a customer misses payments or their risk profile changes, their limit can be reduced or paused for new instalment plans while existing plans continue to be collected as normal.

PaidTerms instalment plans run over 3, 6, or 9 months. Available options can vary by invoice size and customer approval.

Your customer chooses the plan length (3, 6, or 9 months) at checkout, from the options they're eligible for.

Repayments are collected automatically from the customer's chosen payment method on each instalment due date, so you don't need to chase individual instalments yourself.

Yes. A customer can repay their instalment plan early.

Yes. You can offer instalments on partial invoices or deposits, subject to approval.

Dunning is the automated process of following up on a missed or failed instalment payment (reminders, retries, and escalation), so you don't have to chase customers manually.

PaidTerms automatically retries the payment over the following days and notifies the customer directly, prompting them to update their payment method or resolve the issue.

No. Reminders, retries and further communications are handled automatically by PaidTerms as part of the dunning process, so your team isn't spending time on collections admin.

If a payment fails, we will retry it twice before contacting the customer. If payment failures persist, the customer may no longer be eligible to use PaidTerms.

Yes. You'll see the status of every instalment plan in the merchant app, and you're notified when a customer's plan becomes overdue or requires attention.

On the direct option, PaidTerms manages the automated dunning process on your behalf, though because payments flow to you as they're collected, persistent nonpayment can affect your cash flow until it's resolved.

On the funded option, you've already been paid upfront in full, so PaidTerms takes on the collections risk and process for any overdue instalments. It doesn't affect your cash flow.

Accounts that remain unresolved after the automated dunning process move to a further review stage, which may include additional collections steps. Specific terms depend on your merchant agreement and which option you're using.

Yes, customers can raise a dispute through support, and PaidTerms will work with you to resolve it, pausing further collection attempts on the disputed amount while it's investigated.

Yes. Repayment history, including any late or failed payments, feeds into a customer's ongoing credit assessment and can affect the purchasing power available to them going forward.

On the funded option, you're paid upfront in full once the instalment plan is confirmed and the invoice is approved, typically within one to two business days.

On the direct option, you receive each instalment as it's successfully collected from your customer, following the plan's payment schedule.

Every payout is matched against the specific invoice and instalment plan it relates to, and reconciles automatically with your connected Xero account if you're using the integration.

Payouts are made by direct bank transfer to the NZ bank account registered on your merchant profile.

Yes. You can view a breakdown of upcoming payouts in your merchant account. PaidTerms pays out in under 24 hours.

The direct option is free for merchants to use. There's no PaidTerms fee. The funded option charges a flat 1.5% fee on the invoice amount when it's funded through PaidTerms.

Yes. The direct option is free for merchants and there's no PaidTerms fee, though you can choose to pass on a fee to your customer. The funded option charges a flat 1.5% merchant fee, reflecting that PaidTerms is funding the invoice upfront and taking on the collections risk.

No monthly platform fee applies to either option. The direct option is free to use, and the funded option's pricing is charged per transaction, so you only pay the merchant fee when you use it.

On the funded option, the merchant fee is deducted from the invoice value before payout, and the customer separately pays an instalment fee starting from 3.95%. On the direct option, PaidTerms doesn't charge either party. You decide whether to pass on a fee to your customer for paying in instalments.

Repeated failed payment attempts may incur a small processing fee, in line with your merchant agreement. This is disclosed upfront and not a hidden cost.

On the funded option, the merchant fee is a flat 1.5% of the invoice amount when an invoice is funded through PaidTerms. You receive the remaining amount upfront. See full pricing and worked examples on our pricing page.

No. The 1.5% merchant fee stays the same regardless of the instalment term your customer selects.

PaidTerms is different from traditional invoice finance or factoring. Traditional invoice finance generally advances money against the supplier's existing receivables. PaidTerms is designed as a payment option on a B2B transaction: the supplier can receive payment upfront while the business customer pays the purchase over instalments.

Invoice factoring typically involves selling existing receivables to a factoring company, often as an ongoing facility tied to invoice volume. PaidTerms instead offers instalments as a payment method at the point of an individual transaction, so a supplier can choose invoice by invoice whether to offer the option, without committing to a facility.

Approval is based on a combination of credit checks, the customer's trading history, and information provided during onboarding. The exact criteria are proprietary but designed to keep approval fast for genuine trade customers.

Yes. Use our Send Invoice or Universal Link features to invite a customer to apply for PaidTerms.

If a customer isn't approved for instalments, you can still invoice them through your normal process. PaidTerms simply won't be available as a payment option for that invoice until their status changes.

A light business verification is part of onboarding (to confirm you're a genuine, active NZ business), but this is separate from the credit assessment applied to your customers.

You can reach the team through the support option in the merchant app, or by booking time directly with your account contact.

Yes, this can be updated in your merchant profile. For security, changes to payout bank details go through a short verification step.

Contact support to close your account. Any active instalment plans will continue to be collected and paid out as scheduled before the account is closed.