By Ashley Pemberton,David Rivers
Copyright dailystar
The world’s first AI law firm that recovered £7,000 ($9.4k) debt for a small business in record time has been hailed a “genuine game changer”. Garfield AI drew up a legally compliant letter for a customer short on time and money. Employees paid just £7.50 — around the price of a pint in London — for the accurate document which quickly recovered the funds, just months after being approved by Solicitors Regulation Authority (SRA). Now AI and financial experts have said it could be a game changer and believe it will scare slack businesses into coughing up overdue funds. Mitali Deypurkaystha, founder and CEO at Impact Icon AI, said the firm “demonstrates the ingeniousness of AI done right” while also highlighting its limitations. She added: “For small business owners, chasing debts isn’t just admin. It’s exhausting and demoralising. Garfield AI lifts that mental weight. I also commend the creators for keeping Garfield AI affordable, even for solopreneurs. “But the current UK £30bn cashflow logjam persists because FTSE350 giants behave like schoolground bullies, imposing 90–120 day terms that crush smaller suppliers. That’s not late payment, that’s unethical payment. “I fear some firms use these terms knowing a percentage of small suppliers will fold, effectively pocketing free goods and services.” Early users range from sole traders to blue-chips, and professional services firms including law firms, accountancy and medical firms. Many small businesses are forced to write off billions of pounds in unpaid invoices every year. But Omer Mehmet, managing director at Welling-based Trinity Finance, said it could be a gamechanger for small businesses as it turns a drawn out, expensive process into something that takes minutes and costs pocket change. He said: “Late payments strangle small businesses, and most owners simply don’t have the time or money to chase every overdue invoice. An AI tool that can send a compliant legal letter for less than the cost of a pint is a genuine game changer. “If it works as promised, it could unlock thousands for SMEs who currently write off debts as ‘too small to fight’. Anything that gives entrepreneurs back their cashflow and headspace is a win.” But Kate Underwood, managing director at Kate Underwood HR and Training, urged: “Debt recovery isn’t just admin you can automate, it’s law — and law is messy. Shiny new tech won’t mean a thing if the process doesn’t stand up in court. If that happens, it’s not progress, it’s just another false hope for small businesses.” One of the first businesses in the world to use legal AI to recover a problematic debt was transport consultancy Mayer Brown Limited. From sign-up to sending a legally compliant Letter Before Action took the firm less than five minutes at a cost of just £7.50 (+VAT). Finance director David Bone said: “Using Garfield allowed us to successfully recover around £7,000 in outstanding invoices with only a few minutes of work. It is an incredibly effective and efficient tool that has really helped with debt recovery.” In the past month, numerous Garfield users have seen debts paid in full after either LBAs or Claim Forms at Court were issued using the unique AI-powered legal engine. Customers pay £2 (+VAT) for a polite legal chaser letter moving up to £7.50 (+VAT) for a formal Letter Before Action. Around 80% of cases settle at these early stages. If they don’t, users can escalate to issuing court claims electronically through the platform at a fraction of the price of hiring a traditional law firm, with many costs recoverable on success. Philip Young, Co-Founder of Garfield AI, said: “Invoices should mean money in your bank, not a line gathering dust on an aged debtors’ report. “For the first time, SMEs no longer have to shelve plans of chasing outstanding debt just because they are afraid of the upheaval and cost. Too often the time to recover debt can disincentive SME owners from doing it, but AI collapses the time from hours or even days into minutes. “Unlocking the £11bn trapped in late payments will be a game-changer for UK business. With a faster, fairer way to recover money owed, entrepreneurs can focus less on chasing debts and more on growing their companies, creating jobs and driving innovation.” For the latest breaking news and stories from across the globe from the Daily Star, sign up for our newsletter by clicking here .
