Dunning Level refers to the stages of collection in the accounts receivable process, which is used to collect payments owed to a business. Generally, businesses have four levels of dunning that they use when attempting to recover unpaid debts. The first level is a reminder message sent to the customer; the second is a second request with a slightly sterner tone; the third is an official demand letter sent via certified mail; and the final stage is legal action. By utilizing the Dunning Level approach, businesses can increase their chances of collecting on unpaid debt while maintaining a positive relationship with customers.