What is Net 60 payment?

Net 60 payment is a B2B payment term that gives the buyer 60 days to pay an invoice, usually counted from the invoice date or another agreed starting point. It is a form of trade credit commonly used between businesses.

For example, if a supplier issues an invoice on September 1 with Net 60 terms, the buyer generally has until around October 31 to make the payment, depending on the contract and how the payment period is defined.

Net 60 can help businesses:

• Manage cash flow: Buyers have more time to receive or sell products before payment is due.
• Support larger purchases: Businesses can place orders without paying immediately.
• Establish supplier relationships: Credit terms can support ongoing B2B transactions.
• Plan receivables: Suppliers can track when payments are expected.
• Automate payment reminders: Accounting and ERP systems can monitor approaching due dates.

Example: A wholesaler purchases ₹5 lakh of inventory under Net 60 terms. The supplier ships the goods and issues an invoice, while the wholesaler pays within the agreed 60-day period.

The exact due date, late-payment charges, discounts, and eligibility for Net 60 should be defined in the contract or invoice terms.