Sooner or later, law firms are confronted with the question, “should my firm accept credit cards?” In today’s increasingly cashless society, many firms still grapple with technical, financial and other factors concerning their decision to accept credit or debit card payments for earned and unearned fees. There are many compelling business reasons why accepting electronic payments is a smart business decision for your firm, including:
#1 Get paid faster. The easier it is to pay, the faster you will get paid. Net 30 clients often take 30 days or more to pay their bill. In comparison, credit card transactions allow clients to conveniently pay on time, with funds typically deposited in the law firm’s bank account within 48 hours— a significant improvement from the weeks that often transpire before some clients drop their checks in the mail.
#2 Improve cash flow. If your practice currently maintains a significant outstanding amount of receivables, then you are effectively extending credit to your clients. By allowing your firm to accept credit card payments, you can shift your receivables to the card-issuing bank while you stay focused on your clients’ legal matters. Credit card processing fees pale in comparison to the value of receipt of immediate payment.
#3 Fewer write offs. Unpaid invoices can have a serious impact on your firm’s bottom line. By offering more payment options, your firm can increase its opportunity to get paid in full and decrease the risk of invoice abandonment. Credit card payments can be easier for your cash-strapped clients at a time when access to liquid funds is otherwise an issue.
#4 Client satisfaction and retention. It’s a fact: most clients today live on plastic. Offering the convenience of credit card payments differentiates your firm from the competition and offers your firm a marketing advantage. In addition, many clients are motivated by the incentives offered by credit cards companies, such as miles, points and cash back. Big ticket invoices = big rewards.
#5 Automation. Automation is the cornerstone of helping your businesses improve performance, lower costs and drive operational efficiencies. Integrated payment processing software solutions, such as ClientPay, can automate your accounts receivable processes by automatically updating client receivables. Efficiencies include reducing data entry time, reducing errors, making fewer trips to the bank to deposit checks, waiting for checks to clear the bank, etc. Setting up online “click to pay” option through a secure website portal can also be a big time saver for both your firm and your clients.