Net 60 payment terms: meaning, pros, cons and when to offer them

Net 60 payment terms mean the full invoice amount is due 60 days after the invoice date. The customer may pay any time in that window, but payment becomes late on day 61.

Net 60 vs net 30

Net 30 gives the customer one month; net 60 gives two. For the seller, net 60 means carrying the cost of the work for twice as long before cash arrives. Large companies often request net 60 or longer as standard procurement policy.

When net 60 can make sense

• The customer is large, creditworthy and has a record of paying on time.
• The contract value justifies the extra wait.
• You have the cash buffer to cover two months of costs on that work.
• You can price the longer terms into the deal.

How to protect yourself

• Write the terms on every invoice, e.g. "Payment due within 60 days of invoice date (Net 60)".
• Ask for a deposit or milestone billing on long projects.
• Offer an early payment discount such as 2/10 net 60 if faster cash is worth it to you.
• State any late fee in the contract before work starts, where local law allows.
• Send a reminder before the due date, not only after it.

What to do when net 60 invoices go overdue

Follow up on a fixed schedule from day 61. Consistency matters more than tone. AI Money Recovery builds that follow-up from your own invoice data, requires your approval before anything is sent, and charges a performance fee only when money is recovered.

Late fee and interest rules vary by jurisdiction. Confirm with an adviser before adding them.

Frequently asked questions

What does net 60 mean?

The invoice is due in full 60 days after the invoice date.

Is net 60 from the invoice date or delivery date?

Usually the invoice date, unless your contract states otherwise. Spell it out to avoid disputes.

What does 2/10 net 60 mean?

The customer can take a 2% discount by paying within 10 days; otherwise the full amount is due in 60 days.

Should a small business accept net 60?

Only if the customer is reliable and you can fund two months of costs. Otherwise negotiate deposits, milestones or shorter terms.