A Guide to FedEx and UPS Late Payment Fees - AFS Logistics (2024)

The payment environment has drastically changed in the past few years. Up until recently, payment terms for FedEx and UPS were 30 days. If payments are not made by their due date, additional costs are applied – something that UPS has been doing since 2003. FedEx, however, did not begin applying late fees until 2021. But now UPS and FedEx have drastically lowered their payment terms with the majority being 15 days or less. And both companies now apply an 8% late payment fee, a substantial jump from 6% in 2022.

To prevent added costs to you, it’s critical to know when your invoices are received and to pay them as soon as possible. It may sound like we’re stating the obvious but UPS invoices on Saturdays. And weekends are included in the payment terms so day one is Sunday and you have even less time to pay your invoices than you would think. FedEx invoices can fall any day of the week (although it’s usually the same day every week) so the actual number of business days you have to pay your invoice can be a coin toss.

Payment Options

To pay your invoices, you have a few different options.

1. Credit Card Payment – Carriers have been known to adjust their customer’s pricing program if they pay by credit card.
2. Electronic Funds Transfer (Automated Clearing House) – An ACH transactionbasically consists of a data file containing information about the desired payment. Processing a transaction consists of sending that file to the originator’s bank, then to the clearing house, and finally to the recipient’s bank, where the funds are transferred to the receiving account.
3. Check – There is very little chance of a check payment being received and applied to an invoice prior to the late fee being applied.

Under carriers’ current payment terms, paying your invoices on time is incredibly difficult. AFS can help. Reach out to our parcel team for more information to ensure you never miss another payment.