Late Payment Finance Charge Policy Q&A

Why is Union Pacific implementing a finance charge on freight bills paid past credit terms?

Rates are established on the basis that freight bills will be paid within the agreed upon credit terms. However, over the past several years, the percentage of freight bills paid beyond these credit terms has increased. The late payment finance charge is intended to encourage adherence to credit terms.

How is the finance charge calculated?

The finance charge will be assessed after payment of a freight bill at an annual rate of 12% or 0.0329% per day for each day the freight bill was past due. The date a freight bill is due is calculated as invoice date plus credit terms. The days past due will be calculated as due date minus the date funds were received by Union Pacific.

How are the due dates for freight bills determined?

The due date for freight bills is calculated from the date the freight bill/statement is issued. For customers using positive pay (invoiceless), the date of issue is assumed to be one day after the date the waybill was tendered.

Will customers receive only one finance charge bill per month?

Yes. A summary invoice for the total late payment finance charges for all freight bills paid outside of credit terms will be issued each month. Along with the summary, we will also include the line item detail for each freight bill paid beyond credit terms.

What day of the month will the finance charge bill be issued?

A late payment finance charge invoice will be issued by the 10th of the month. The invoice will cover all freight bills paid late during the prior month.

If a customer uses a third party to pay freight bills, will they still be subject to a finance charge?

Yes. The decision by a customer to use a third party does not eliminate the requirement for the payment to be made within the credit terms. The customer will be responsible for any finance charges that accrue due to the failure of the third party to process payments within Union Pacific credit terms.

If a customer pays their bill through an electronic payment method, will they be subject to finance charges?

Yes. Regardless of payment method, all payments made beyond credit terms are subject to the late payment finance charge.

How do I dispute a freight bill?

See our Claims and Disputes information for further details.

If a freight bill is being disputed, is a finance charge assessed?

If the dispute results in a correction to the freight bill it will not be subject to the late payment finance charge. If the dispute does not result in a correction to the freight bill, it will be subject to the late payment finance charge. However, the time that the freight bill was in dispute will be excluded from the finance charge calculation.

If a customer has questions regarding finance charges, whom should they contact?

Customers should contact Union Pacific's Accounting Department at the toll-free number shown on the bill.

We have created an Account on the Web (AOW) option to assist our customers in the payment process. Customers can utilize Account on the Web to view and pay bills directly online. AOW offers customers time and cost savings with immediate confirmation of payment, reduced paperwork and faster resolution of billing disputes.