Improve your clients’ experiences with frictionless billing
By Amy Mann, LawPay
People are used to the convenience of electronic payments and online bills. Many studies show most people expect businesses, including retail and service providers, to offer a wide variety of electronic payment options.
If your practice is committed to providing a 21st century client experience, you must adopt frictionless billing payment processes. Not only is doing so necessary to give your clients the service they want and deserve, but if your firm doesn’t step into the modern era with electronic billing and payments, you’ll discover another firm already has, which can make them more attractive to your clients.
What Is frictionless billing?
Frictionless billing is a payment process that involves fewer steps and simpler interactions. Online retailers and service providers have pioneered the frictionless transaction process for the digital age by removing the need for customers to visit physical locations, implementing one-click purchasing, and offering automatic billing.
In the law firm context, frictionless billing involves making it easier for clients to pay by reducing the number of steps in the process. Like with online retailers, having electronic payment options is central to frictionless billing and a positive client experience.
Frictionless billing eliminates waiting for a paper invoice to come in the mail, getting out a checkbook, and mailing a check. It also alleviates a client’s uncertainty regarding whether he or she sent the payment or the law firm received it. Instead, electronic payment options reduce the payment process to just one click in many cases.
How electronic payment tools reduce friction for clients
Electronic payment solutions simplify your firm’s billing process and increase the ease of submitting payment for your clients. Electronic payments can help remove barriers for your clients and enhance their experiences by doing the following:
Eliminating paper bills
Electronic payment solutions clean up the messy paper trail of old payment methods. Emailed invoices and online platforms your clients can log into make it easier for them to access invoices and payment records or refer for information they may need.
Offering instant confirmation
One of the keys to online retail’s success is the provision of instant gratification. Electronic payments offer this same feeling to clients, who can receive immediate automated payment confirmations to know that their payments have been received by their lawyers. Both the lawyer and client no longer need to wonder where the client’s payment may be.
Facilitating preferred payment methods
Surveys of consumers show that most people prefer paying with credit or debit cards or by other electronic means. This includes payments not only for consumer goods but for any bills they receive, including invoices from service providers like lawyers. If a law firm continues to require clients to pay by check, it only creates another point of friction in the payment process, especially for those clients who no longer use or own checks. In some cases, the friction may be too great for a client or prospective client, forcing them to look for another law firm willing to accept electronic payments.
Allowing clients to pay on their own schedule
The proliferation of electronic payments has taught us all the convenience of being able to pay our bills on our own schedule. If clients can pay your invoices on their own schedules rather than during your business hours, it represents a small but noticeable improvement in the client experience.
What lawyers should consider when accepting electronic payments
Of course, lawyers face unique issues in accepting electronic payments that many other retailers or service providers do not have. This mostly stems from lawyers’ ethical obligations with respect to client and third-party funds. Ethical rules require lawyers to separate payments received from a client or third-party that do not represent expenses or earned fees into a separate trust account.
In the earlier days of electronic payments, lawyers did not necessarily have the option to divert client payments into trust accounts. However, in recent years, the legal industry has seen the launch of electronic payment processors targeted specifically for law firms, offering lawyers the ability to separate payments into earned and unearned funds and send funds to their proper accounts.
Processing fees from electronic payments also posed ethical and operational issues for law firms. Lawyers cannot use payment processing to accept client payments representing unearned fees if the payment processing fees are deducted from the payment itself. Those funds still legally belong to the client, so deducting fees and expenses from client property represents a violation of ethical and fiduciary obligations.
However, payment processors for lawyers allow firms to ensure that fees and expenses are appropriately deducted from operating accounts rather than client funds.
From a practical perspective, payment processing fees also represent an expense or overhead that lawyers have resisted. But more and more firms are recognizing that payment processing fees should be looked at as just another cost of doing business and factored into the firm’s financials accordingly. Many lawyers also note that the minimal costs of electronic payment processing are far outweighed by the benefit of immediate, confirmed payment.
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If you have questions or want information from those who have implemented these solutions for law firms, members can ask an expert for free via email or during a virtual visit.
Reprinted with permission of LawPay. Originally published here.