How to Switch Your Clients to Electronic Payments In 5 Easy Steps

If your firm is like most, the thought of asking clients to start paying online may be scary!

Luckily, it’s much easier than you think. Follow these five steps to gracefully start all new clients with electronic payments and migrate existing clients to your new process.

1. The choice is not optional. Institute a formal Payment Policy.

When you begin working with a new client, it is your responsibility to set the expectation for how you will be paid. The client doesn’t know what your policies are or if you even have them until you tell them. By instituting a formal Payment Policy you set a standard of when and how your bills will be sent and your fees will be paid.

Taking the time to create a formal Payment Policy also sends a message to your clients that your firm is governed by efficient rules, and those rules were constructed for a reason. The act of creating a policy makes it easier for your staff to politely enforce it, including the accepted methods of payment. Here’s an example: a new client books a consultation and attempts to pay via paper check, your front office staff politely lets them know that “our Payment Policy is that we accept electronic payment via eCheck or Credit Card or Electronic Check within five days of the invoice date.” This sets a clear expectation for both the employee and the client right from the start.

2. Include payment language in your Retainer Agreement or Engagement Letter

Once you have a Payment Policy outlined, include the same language in your Retainer Agreement or Engagement Letter. The addition of a simple paragraph communicates your payment preferences to the client while also covering your law firm from liability in the event that a fee dispute arises. Malpractice carriers also appreciate the extra accommodation and may offer you a discount for doing so.

3. Train staff on how to appropriately share your payment policy

Now that you have completed steps One and Two, it’s time to train your staff. Hold a team meeting to keep the training consistent for all team members. Explain that moving forward, all clients will be required to pay electronically via credit, debit card or eCHeck. Print the Payment Policy out and provide a copy to each employee to keep at their desk as a reminder. Role play a conversation with a client during the intake, consult, and collections process using the printed policy as a guide. Have your billing staff practice sending an electronic payment request, process a payment in person or over the phone, and how to follow up on outstanding invoices using the new payments system. Then make sure to check in on how the policy is being implemented and be available for questions during the roll out process.

Depending on what software you will be using to process payments, the second portion of training should be on the software itself. Most providers offer free and unlimited training sessions, and your firm should take full advantage (pro tip: most vendors would be happy to also treat your staff to lunch during the training session).

4. Make a plan to transition existing clients to electronic payments.

Now that you’re starting out on the right foot with all new clients, it’s time to turn your attention to the outstanding invoices and existing clients on using outdated payment methods (goodbye checks and manual wire transfers). First, create a spreadsheet or a list that includes; Client Name, Email Address, Phone Number, and the amount(s) they owe, including the related invoice number and invoice date.

Next, draft an email explaining the firm has a instituted a new Payment Policy and you’re excited to offer all clients an easy online payment system. Then block out a few hours each week to email those clients or have a non-billable staff member do so, and include a link that allows the client to pay any outstanding amounts owed online instantly. If you’re not comfortable sending emails with the information, give them a call to explain that the law firm has instituted a new Payment Policy to make it easier than ever for them to pay their retainers and fees and that you’re calling to help get them set up.

This process is a great client service touchpoint and a way to show your clients that your law firm is innovative and trying to save them time and hassle by doing away with outdated payment methods.

5. Tackle AR with electronic payment plans and automated collection follow up

Accounts Receivable balances can slowly kill a law firm and the most successful firms have figured out how to improve their realization rates and collect as much as possible quickly. Offering e-payments is the easiest way to start getting paid faster and collect more on the dollar, helping you take control of your firm’s AR with less effort. Electronic payments also make it incredibly easy for your clients to make a partial payment on a bill or schedule a series of payments for clients who are not able pay the entire balance immediately. Some payment processing software will even track the status of all outstanding AR and send clients reminders for overdue invoices, automating your collections and follow up processes for you.

In Summary

Remember, even though changing a habit can require organization and discipline, it doesn’t need to be difficult or scary. In just a few short weeks you’ll see how these new habits can produce major changes in your AR and cash flow, and will have become second nature to you and your staff.   The best result: your firm’s new Payment Policy will most likely delight your clients and result in more business for your firm: 71% of clients report higher satisfaction rates when offered e-billing and payment options, and 36% were less likely to switch to a competitor firm.

For a free one-on-one coaching call to discuss how to move your law firm to online payments, click here or call us at 888.384.3236.

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