An unpaid invoice from an Israeli customer rarely stays a simple unpaid invoice. After a few weeks of silence, the customer usually finds a reason: late delivery, a quality complaint, a deduction, a change of contact person. How you handle the first 30 days decides how much of the debt you recover and what it costs you.
This guide is for foreign suppliers and service providers with a written contract and an overdue invoice. It is general information and not advice on a specific debt.
Find out why it is unpaid
Ask in writing, in one short message, why the invoice has not been paid. The answer sorts the debt into one of three groups: a customer that has the money and no reason to hold it, a customer that disputes part of it, and a customer that cannot pay. The third group needs a different plan. Start with our guide on how to check an Israeli company.
Keep every answer. A dispute that shows up for the first time after a demand letter looks like a tactic. A dispute raised early in an email may be real, and you should know that before you escalate.
Build the file before you write the letter
A strong file is short and complete. It should hold the signed contract or the accepted order, the invoices, proof of delivery or acceptance, and the correspondence in which the customer acknowledged the debt or asked for time. If your terms of sale were never signed, add the emails that show the customer ordered under them.
Most unpaid invoices are lost on paper, not in court. The file you build in week one is the case.
Work out what you can add to the debt
Look at your contract first. If it sets interest or a charge for late payment, that term applies. Under section 6 of the Interest and Linkage Adjudication Law, 1961, a court does not add statutory interest for the late period where the contract already has a provision on interest for delay. If the contract is silent, section 2 lets the court add interest and linkage, and section 5 provides for interest and arrears charges from the payment date. The court decides, so state the rate in your demand only if the contract supports it. For how the dates and arrears fees work after a judgment, see our guide to interest on a judgment in Israel.
Send a demand that can be used later
Your demand should be dated, short and factual. It should name the contract and invoices, state the amount due and the interest you claim under the contract, set a final date, and say what you will do next. A letter that a court can read in one minute is worth more than a long angry one. For the wider playbook, see our guides on commercial debt collection in Israel and recovering money as a foreign creditor.
A cheaper route for smaller debts
Section 81A1 of the Execution Law allows a fixed-sum claim to be filed directly with the Execution Office, without a court judgment first. It applies to a debt of up to 75,000 shekels at the date of filing that rests on a written document or on an express statutory duty to pay. The debtor must first receive a written warning by registered mail. The filing can be made once 30 days have passed from service of that warning, and no later than a year from it. If the debtor objects in time, the Execution Office stops and the case moves to the court. The law does not limit this route to Israeli residents: a foreign creditor can file with the Execution Office like any other creditor. If a lawyer files for you, a power of attorney is attached, and one signed abroad is normally proved through an Israeli consul or a notary, with the notary’s signature authenticated. Whether the route suits your debt still depends on the document behind it and on whether the customer is likely to object.
When to stop writing and file
If the customer admits the debt but keeps delaying, or disputes it with no documents, the next step is a claim. If the customer shows signs of insolvency, speed matters more than elegance. Our guide on suing an Israeli company from abroad explains the limitation period, how the claim runs, security for costs and service.
Have an overdue invoice from an Israeli customer? Contact RNC Group and we will tell you which route fits the debt before you spend on it.
An Israeli customer not paying? The first 30 days decide whether you collect at all.
A documented demand, preserved evidence and the right pressure channel turn most invoices into payment without a lawsuit. Waiting costs leverage.
We collect commercial debts from Israeli customers for foreign and local businesses. Reach us on WhatsApp or by email.
This article provides general information only and does not constitute legal advice. It does not create an attorney-client relationship, and readers should obtain legal advice suited to the facts, jurisdictions, and procedural posture of their specific matter.