5 Ways to Collect Payments Online More Effectively

Why Collect Payments Online?

Online payment options are a fast, convenient and secure way to pay for services and the preferred payment method of 75% of customers. Online payment options should be a staple in every service business because they contribute to a better customer experience, which translates to increased sales and higher customer satisfaction. Yet 1 in 5 small businesses doesn’t accept digital payments. 

There are multiple ways to collect payments online; none are difficult to implement, and most are low-cost solutions. So, if you’re looking to streamline your service business's sales and payment process, here are 5 ways to collect payments online more effectively. 

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5 Methods to Collect Payments Online 

1. Use an Online Payment Processing Platform to Collect Payments

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You can easily collect payment online by using online booking software that integrates with an online payment processing platform. However, choosing the right online payment processing platform is important since not all are created equal. 

To reduce the chance of losing the sale, choose a payment processor 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. For example, when customers book an appointment via the MarketBox platform, they can pay within the booking flow using a Stripe integration. They never have to leave the page, and payments are processed quickly and securely. 

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Benefits of using an online payment processing platform to collect payments:

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• It reduces fraud — Built-in fraud protection will automatically put a hold on the credit card or test it ahead of time to ensure payments will go through successfully. This is important because the average business loses 5% of its revenue to fraud every year. ‍
• Allows you to off flexible payment options — Online payment processors allow your service business to accept credit and debit cards, ACH, and dozens of popular payment methods like Apple Pay or Google Pay. This will enable you to service the different needs of your clients and offer them more flexibility with their payment choices.‍
• Securely stores sensitive customer data — Online payment processors have in-built security measures that ensure your customer’s credit card and personal information are kept safe and stored in accordance with data protection laws. ‍
• Enables you to offer codes and coupons — When you collect payments online, it’s easy to send promo codes and coupons to your customers that they can use at checkout. This is a great way to increase sales and reward customers for loyalty.  ‍
• Seamless checkout — Delays in the checkout process, which often occur due to manual payment methods, can result in higher cart abandonment. Collecting payments online optimizes the user experience for your customers and helps increase conversions/sales. 

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2. Use Invoicing Software to Collect Payments

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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. 

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Benefits of using invoicing software:

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• ‍It makes it easy to track payments — Invoicing software makes it easy to track payments as you have a record of the invoices that have been sent and received from customers. 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.‍ 
• It automates recurring admin tasks like creating receipts, etc. - Invoicing software automatically generates professional-looking invoices and sends them to your customers on your behalf. Once the customer has made a payment, it will follow up by sending the customer's receipt, and if they forget to pay, you can program payment reminders. These automations help save time for your team and simplify managing your service business.

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3. Take Credit Card Information Beforehand 

Taking credit card information at the time of booking the service appointment is another effective way to collect payments online that ensures customers promptly pay for the service. Once you have their details, you can charge their card at the agreed point (before, during, or after the appointment.)

If you take credit card information upfront, you avoid payment delays. This helps safeguard your business against lost income; your customers have put “collateral” on the line, making them more likely to uphold their commitment to your business. 

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4. Only Take Credit Card Payments

It may seem limiting to only collect payments in the form of credit card payments, but many service businesses benefit from this singular form of payment. 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.

We’re moving towards a cashless society (and no one writes a cheque anymore), so card payments are quickly becoming the norm. In the last few years, consumers have become much more used to paying for products and services online, and it has become the standard.

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Benefits of only collecting payments via credit card:

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• Guaranteed payment faster — You can store payment details and charge the credit card when the service appointment is complete. This means you don’t have to worry about customers not having cash, forgetting to pay, or having to chase down payments. ‍
• Less time is spent processing payments — If you’re using an online booking software, some can automatically charge a customer after the service is complete, cutting down on the manual work required to charge the credit card.

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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 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 genuinely not satisfied with the service. This will make them feel more confident in their decision.  

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The benefits of taking a large deposit upfront include:

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• You minimize the risk of non-payments — If you collect payments online upfront, then you have secured at least partial payment and have their information stored to take the remaining amount after service completion.  ‍
• You can safeguard against the risk of taking on new customers — 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.

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Ready to get started? 

The advantages of collecting payments online are evident, and as we’ve covered, integrating them into your business doesn’t need to be complicated. 

If you're looking for a way to offer online booking and collect payments online, book a call with the team to learn how MarketBox can take your business digital. ‍