As a small business owner, you’ll know first hand that taking payments from your customers can be hard work.
Whether you’re spending too long putting together invoices or you are growing increasingly frustrated by customers who are late paying their bills, you’ll no doubt be on the look-out for new ways to manage money and ensure you get paid for the work you do on time, every time.
This is especially true for digital businesses and those who offer subscription-based services, like a monthly retainer or ongoing work that requires a monthly payment.
Taking the time to send every client an invoice every month is truly painstaking, and so surely there must be a better way that will free up some hours for you to work on more important tasks?
Today, we offer reasons why you should consider billing your customers using Direct Debit, and why card payments, PayPal, and other payment vendors could be a thing of the past.
You get paid on time
When you set a customer up with a Direct Debit payment scheme, you’ll be in control of your payments, and you’ll know that you’ll be paid at the same time every week, month or quarter.
This is particularly useful for businesses that have lots of late-paying clients – you won’t have to chase them, and you can focus on running your business and delivering a great service.
Direct Debit is cheaper
Another reason why so many small businesses are switching to Direct Debit payments is cost.
PayPal is a particularly expensive payment provider, taking up to 5% of a payment as part of their admin fee.
That’s fine for small payments, but if your clients are sending you large sums, this can quickly add up and become a £10 or even £50 fee per month per client.
Direct Debit, on the other hand, is much cheaper.
You get paid directly to your bank account, and if you work with a payment provider such as GoCardless, they’ll only charge a small fee up to a maximum of £2, so you’ll never be ripped off for accepting payments from clients.
Payments won’t fail
Whilst you can’t guarantee that your clients are always going to have the necessary funds in their bank accounts, Direct Debits are much more likely to be processed than cards.
Indeed, the industry standard for card payment failures is 4% – that’s one in every 25 customers.
With Direct Debit, you can schedule payments from your clients’ bank accounts, rather than a card, so even if their debit card expires or you can’t get in touch, there’s a much higher chance that your payment will be approved and processed once you have signed them up.
Better cash flow
Small businesses are fragile – one poor month or a string of clients who refuse or delay payment can be a big deal, and cause you some serious cash flow problems.
When you use Direct Debit, you’ll know exactly when payments are on their way so you can better plan everything from stock management to staff hours to marketing and advertising spends.
Direct Debit gives you added peace of mind and comfort that your clients’ payments are on their way to you and that you won’t have to balance the books and delay payment on your own invoices until your clients pay yours.
It’s simple, it’s effective, and it’s convenient.
Direct Debit is so easy
You may think that setting up a Direct Debit for your clients is hard work, but the truth is that it only takes a minute or two to get started.
You can do it on your own and send your clients instructions on how to add you as a Direct Debit, or you can work with a company such as GoCardless who can manage your transactions and set you up for a low fee per transaction.
A note from 99social
This year, we’re switching from PayPal and debit card payments to Direct Debit to save time, money, and to ensure we can deliver an effective service to our clients.
If you’re already a 99social client, you’ll receive an email in the coming weeks to let you know about the change, but if you’re not signed up, we’ll talk you through the process once we get started.
Direct Debit allows small businesses to overcome the ludicrous fees imposed by American giants like PayPal and allows 99social to continue to offer services from as little as £99 per month.
We thank you for your understanding and support as we make this change in 2019.