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Chasing payments? Five ways to make it easier to get paid

7th May 2024
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Sage is the market leader for integrated accounting.

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We all know that the financial health of our accounting practices and clients relies on efficient cash flow management.

There’s a common saying in business: strong cash flow is king. Strong cash flow management is the lifeblood that helps ensure operations run smoothly and that there is enough capital on hand to cover expenses, invest in growth, run payroll, and mitigate financial risks. 

Last year in its Prompt Payment and Cashflow Review, the government found that small and medium-sized enterprises (SMEs) were owed on average an estimated £22,000 in late payments, adding that late payments drain the economy of £2.5bn annually. Getting paid on time is one of the biggest issues facing businesses – resulting in stress, unpredictable cash flow, and time spent chasing payments that could be spent focusing on the business.

Digital payment solutions, such as Stripe and GoCardless, have emerged as vital tools in improving the payment process, enabling clients to pay faster and more efficiently. In this article, we’ll explore how you can take advantage of integrated payment solutions and the practical strategies that you can apply to streamline the payment process.

 

Switching to newer payment methods

Technology is always changing and so are payment methods. Indeed, the user-friendly nature, high-security standards, and seamless integration with accounting software of platforms like Stripe and GoCardless make them indispensable for modern accounting practices.

Integrating them into your operations brings benefits ranging from:

  1. Faster payment processes: By embedding payment links directly into invoices, it is much easier and quicker for clients to pay. 
  2. Enhanced cash flow management: Features such as recurring payments and direct debits take the pressure off clients to pay each month. It also helps both clients and accountants manage payments and outgoings effectively.
  3. Robust security measures: Platforms like Stripe and GoCardless are designed with high-security protocols, ensuring the safety of financial transactions and building trust in the payment process. Look out for advanced fraud screening, real-time address and security code matching, as well as 3D Secure authentication.
  4. Convenience and accessibility: The ease of making payments through a simple click significantly boosts client satisfaction and encourages timely payments.
  5. Integration with accounting software: The ability to integrate with existing accounting systems automates the reconciliation process, saving time and reducing errors.

 

5 strategies to streamline payments

  1. Integrate online payment tools into your invoicing: Digital payment tools like Stripe, PayPal, or GoCardless give your clients a range of payment options (credit cards, debit debits, e-wallets). By integrating these into your accounting software, your clients can pay with a simple click. This not only speeds up the transaction process but also provides convenience and flexibility.
  2. Use payment links in invoices and communications: Include your direct payment link in every digital invoice and email communication. This reduces the steps your clients need to take to complete payment, directly influencing the speed and efficiency of transactions. 
  3. Offer recurring payment options: For clients with ongoing contracts or regular service engagements, set up recurring payments to automatically charge their preferred payment method at a set interval. This approach is especially effective for subscription-based services or retainer agreements, ensuring timely payments and reducing the admin for both parties.
  4. Incentivise early payments: Encourage faster payments by offering discounts or added value for early settlement of invoices. This could be a percentage off the total bill or additional services at no extra cost. Such incentives not only improve cash flow but also enhance client relationships by rewarding prompt payments.
  5. Educate clients on payment procedures: Provide communication on payment options and processes in everything from your welcome pack, onboarding session, to regular updates. Understanding how to make payments, the variety of payment methods available, and the security measures in place all go a long way to increasing trust and willingness to pay on time.

 

The importance of a streamlined payment process

Incorporating these strategies into your payment process not only makes it so much easier for you and your clients to manage transactions but also plays a crucial role in maintaining a healthy cash flow. By integrating modern payment solutions and optimising the payment process, you can ensure operational stability, foster growth, and build resilient financial foundations.

Choosing an established provider helps give you peace of mind that your customers’ details are well-protected. 

 

How Sage can help

Visit the Sage website to find out more about the variety of ways Sage can help ensure you and your clients get paid faster with our range of integrated payment solutions and the practical strategies that you can apply to streamline the payment process.

 

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