Processing Recurring Payments: Get Paid In Full By Automating Receivables

In any business endeavor, an operator may encounter multiple sweaty-palmed experiences. Obviously, an owner understands that this comes with the precipitous land of conducting business.

Possibly the most daunting problem affecting an “it’s not all what it is cracked up to be” company owner is a payment that is late or never arrives. Think about the private school owner who reminds a parent concerning the monthly fee simply to receive this answer: “Only give me a few more days” Think of a construction company owner who rightfully seeks a periodic payment from the customer and is disregarded with “I’ll pay you when I can.” Imagine a gym owner who may need to do back flips just to collect on this monthly payment.

Whether intentionally or even requirement, there seems to exist a bandwagon of consumers who may not so readily depart with their money irrespective of their responsibility or what’s morally perfect. This lamentable circumstance (i.e., once an owner cannot efficiently collect cash that is expected) seriously hampers money flow – a company’ lifeline, crucial for its energy. When company expenditures increase earnings (negatively influenced by late or non-payments), commercial failure is guaranteed.

There exists two primary ways in dealing with an undesirable client whose cash stays elusive. Many businesses still embrace the collections process – whether they perform this task in-house or contract with external agencies. If the business chooses to contact the customer directly, invoice after bill might be forwarded which is quite labor-intensive and costly. An owner should consider the cost of invoices, postage, late notices and set calls, and also the time it takes personnel to meet this duty (and the concomitant pay / benefits such personnel are accruing). Outside collection agencies aren’t necessarily a valuable alternative. They typically keep at least 25% of an owner’s deserved gain.

The second method of handling the money flow-challenging customer is based on the assumption that a business operator has to be proactive. He/she should realize the benefits of automatic payments, and how this procedure could more easily prevent the “Dear client, please pay me” letter.

Automated payments are a car where a client’s account is automatically debited and moved to an owner’s accounts on the exact date that a payment is due. Upon the decision to obtain a product or utilize a service, a potential customer signs that a simple release form, giving permission to transport payment on a particular due date. recurring payments selects how to cover, most notably with checks or credit cards.

1 option is through paper drafts which might be issued through proper software and delivered to the owner so he/she can deposit them (like they were paper checks) or delivered directly to the owner’ bank. The processing provider acquires the clients’ banking information and converts the information to the appropriate bank draft.