Some companies get paid in large, irregular lumps — a few big project invoices rather than steady monthly income. A fixed collection date does not care that your cash arrives unevenly, so the trick is to smooth it yourself.
Smoothing lumpy income against fixed collections
- Ring-fence a repayment reserve. When a big payment lands, immediately set aside enough to cover the next few collections before you spend anything else. This is the single most effective habit. See paying ahead to build a buffer.
- Keep the reserve in the collection account. Money "in the business" but in the wrong account will not stop a Direct Debit failing. See keeping enough funds in your account for collection.
- Look several collections ahead. Because income is lumpy, always know whether the next two or three collections are covered, not just the next one. See planning payments around seasonal income.
If a gap between lumps gets long
If a stretch between big receipts is going to run past what your reserve covers, tell us before a collection is at risk. See my business cash flow is tight this month. A Credicorp Flex line is designed for exactly this kind of gap — see Flex and Slice payment differences.
Credicorp lends to companies rather than to you personally, so this is business finance outside the consumer-credit regime. That does not change the practical steps below.
See also: Paying ahead to build a buffer, Keeping enough funds in your account for collection, Planning payments around seasonal income.