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Collect Payments Online More Effectively

5 Ways to Collect Payments Online More Effectively

Why Collect Payments Online?

A strategy that your service business can use to improve the payment and purchasing experience for your customers is to collect payments online. Not only will it improve the experience, but it also has the potential to increase sales. Online payments can be taken directly from a bank account through credit or debit card or through an all-in-one payment processor such as Stripe or PayPal.

Remove the pain of paying, so your customers and service providers can easily collect payments online.

The benefit of incorporating online payments into your business is to remove the pain of paying, for your customers and make it easier for your business to collect payments. With online payments, it is way easier for your business to get paid faster.

Streamline the sales and payment process by finding better ways to accept payments online. Here are 5 ways to collect payments online more effectively:

1. Use an Online Payment Processing Platform

Collect Payments Online Using Software

By using a software that has an integration with an online payment processing platform, you can easily collect payment online. It’s important to choose the right online payment processing platform since not all are created equal. Choose one that won’t redirect your customer to another platform to make a payment, but will instead keep them on your site throughout the payment process.

Benefits of using an online payment processing platform:

  • Reduces fraud - built-in fraud protection will automatically put a hold on the credit card or test the credit card ahead of time to ensure payment. 
  • Flexible payments - allows your service business to accept credit and debit cards, ACH, and dozens of popular payment methods like Apple Pay, Google Pay, and more with Stripe payments. 
  • Auto reminders - the platform will automatically send reminders, so your customers will pay on time. No need to chase down a customer for an appointment. 
  • Secure payment- two-factor authentication will keep your customer’s credit card and personal information secure. 
  • Offer codes and coupons - easily send promo codes and coupons to your customers using the payment processing platform.  
  • Seamless checkout - an e-commerce payment page with an optimized user experience will help increase more conversions/sales. If it takes longer to complete the checkout process, you risk cart abandonment. 

2. Use an Invoicing Software

Collect Payments Online with Invoices

Another way to collect payments online more effectively is by using invoicing software to help streamline the process of creating invoices and sending them to customers. Using invoicing software for your service business will help to automate the manual tasks associated with invoicing your customers. A few invoicing software options to consider are Xero, Zoho, Invoicely and more. 

Benefits of using invoicing software:

  • Don’t let invoices slip through the cracks - don’t worry about forgetting to invoice your customer after an appointment is complete. You won’t risk missing out on a payment, which will help you reduce lost income.
  • Recurring payment machine - the invoicing software will automatically generate professional looking invoices and send them to your customers on your behalf. After sending the invoice, the software will automatically send appointment reminders. Once the customer has made a payment it will follow up by sending the customers receipt.

You can keep tabs on where in the payment journey the customer is by setting up triggers for emails at various stages of payment; for example, you can receive notifications when there are successful payments or refunds.

3. Take Credit Card Information Beforehand 

Taking credit card information at the time of purchase or scheduling the service appointment, is the best way for your business  to ensure that your customers will promptly pay for the service they receive from you.

Secure credit card information to secure payment from your customer.

Some  customers might be hesitant to provide their credit card information before the appointment is complete since they may want to determine the quality of the service before making payment. However, assure your customers that you have policies/procedures in place for securely storing their credit card information private and that you will only charge it after the appointment is complete.

Benefits of taking credit card information from customers beforehand:

  • Reduces fraud - you can verify the credit card information to ensure that the correct person is using it and that they have sufficient funds. This is important because the average business loses 5% of revenue to fraud every year. 
  • Guarantees payment upfront - if you take credit card information upfront then your customer cannot delay payment, you’re safeguarding your business against lost income. Your customers have put “collateral” on the line, so they will be more likely to uphold their commitment to your business. 

4. Only Take Credit Card

Collect Payment Online Using Credit Cards

It may seem limiting to only take credit card payments for your service business, but many businesses benefit from this form of payment as opposed to cash or cheques.

Although credit card fees can hover around 3% of the sale price, the cost of uncollectibles tends to be much higher than 3% of revenue for most service businesses. 

There’s no need to worry about scaring customers away, this can be convenient for them as well since they won’t need to write cheques and they can instantly pay using their credit card. In the last few years, consumers have become much more used to paying for products and services online and it has become the standard.

Benefits of only taking credit card:

  • Guarantee payment faster- you can charge the credit card when the service appointment is complete. You won’t need to worry about your customers forgetting to pay after and as a result, you won’t need to chase down payments. 
  • Spend less time on processing payments - you won’t need to spend excessive time going to the bank to cash cheques or deposit cash.  If you are leveraging an online scheduling or sales software, some can automatically charge a customer after the service is complete, cutting down on the manual work required to charge the credit card.
  • Keep track of transactions - easily track the flow of funds from a customer to a recipient, with full records of all transactions. Track your payments with a digital paper trail, no need for paper invoices or wasting time trying to figure out who each of the mystery bank deposits are from.

5. Take a Larger Deposit Upfront

Asking your customers to provide a larger deposit upfront is one way to collect payments online more effectively. The customer can provide an amount upfront and then pay the rest of the money after the service is complete.  

Start by asking your customers to provide a certain amount of the payment upfront, provide reassurance that you offer a money-back guarantee, and will refund the money if they are truly not satisfied with the service. This will make them feel more confident in their decision.  

Benefits of taking a large deposit upfront include:

  • Minimize non-payments - if you collect payments online upfront then you have secured at least partial payment and you also have their information stored to take the remaining payment after service completion.  
  • Take a deposit for now - taking a deposit doesn’t need to be permanent practice for your service business. However, if you have a new customer, you can mitigate risk by asking them to pay partially upfront. Once you build a relationship with them, you can remove this practice.

Ready to get started? 

The advantages of collecting payments online are evident. Use these 5 strategies to create a seamless online payment experience for your customers.

Book a demo with MarketBox to collect payments online and discover the advantages.

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