How can our law firm automate our collections?
Most lawyers, and business owners in general, dislike following up on collections. Yet if you want to be paid for work you’ve already done, basic steps around collections are a necessity.
One way to circumvent the issue of having to follow up with collections—and possibly putting it off instead—is to automate your collections process. Here’s how.
Online payments
Online payment options can help law firms avoid collection issues—by preventing bills from ever reaching that point.
Clients have gotten more used to paying for goods and services online. And the pandemic only strengthened those habits.[1] From a client’s perspective, paying bills electronically is faster and more convenient than writing a check and sending it through the mail.
And with today’s modern billing software, it’s easier than ever for law firms to send out bills electronically—and accept credit card payments, thanks to legal-specific merchants like LawPay. When opting to offer credit card payments, these vendors who have familiarity with the compliance requirements of the legal industry can make sure you’re accepting payments in a way that doesn’t conflict with trust accounting rules.
These steps may seem basic, but giving clients the opportunity to pay within minutes of receiving a bill—and pay with a credit card, rather than having the sum come out of their checking account—makes bills easier to pay.
Automated reminders
For those clients who still don’t pay, automated reminders of overdue bills offer a sensible next step. Yes, there will always be a few people who still don’t settle their bills, but sending out prompt reminder notices can help reduce those numbers.
Additionally, automated reminders can take some of the burden off of you and your staff from having to put time and energy into deciding when and how to follow up.
Evergreen retainers
In certain cases, evergreen retainers can help bypass some collection issues.[2] A modern practice management system with integrated billing and accounting can automatically notify clients when retainers drop below certain, pre-set levels.
Reminding clients to replenish retainers for ongoing legal work can help avoid a situation where you need to initiate collections processes to begin with.
References
1. The Coronavirus Pandemic Has Caused a Surge in Demand for Contactless Payments, Accelerating the Shift from Cash to Digital Options
2. A Closer Look at Collections