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When the Check isn’t in the Mail – How to Automate Payment Collection

3 min read • November 14, 2017

When the Check isn’t in the Mail – How to Automate Payment Collection

You’ve seen it so many times before – a customer owes you a payment, but when you call to inquire they tell you that they mailed it yesterday and the check is in transit. After a few days go by, you still haven’t received it.

One of the worst things about using traditional methods to get paid by clients and customers is that you never actually know when the payment will arrive. You state the due date on your invoice, but clients will send a check on the last possible day or ignore the date altogether. You rely on getting your payments on time, so these delays can cause major issues with your cash flow. Thankfully, there are now ways that you can avoid this pain and automate your payment collection.

1. Start Accepting Credit Card Payments

Sometimes your payments are hard to collect simply because the process of making the payment is inconvenient for your client. Make the collection process much easier by accepting credit cards. Today, there are different payment providers that allow businesses of any size to collect credit card payments, so whether you are running a side-gig or a multi-national corporation, you can offer credit card payments to your clients. Do your research on your provider, however, as small differences in fees can really add up.

2. Move to Electronic Billing and Collecting

Until recently, the only viable option to bill and collect from clients was through checks and wires. However, there have been significant technological advancements in the last few years, and it is much more convenient and secure to send bills and collect on invoices through electronic payment providers. These online payment providers give you more visibility into when the payment was made, and some automatically reconcile payments with your accounting software. As an added bonus, electronic payment platforms are generally less expensive than checks and wires.

3. Set Up Automatic Recurring Payments

Using electronic payment systems, you can set up recurring payments to be withdrawn or charged automatically. Your clients need to give you permission to withdraw a payment from their account, and so you will need to set up a Pre-Authorized Debit Agreement, or PAD. This is essentially a contract that enables you to collect your payment from your client for a given amount on a given day without getting their permission each time. Set it, and forget it.

4. Automate Paper Check Processing

Ok, so this one is slightly misleading – there is no way to completely automate a paper-based process. However, there are some tools you can use to make the check process more streamlined. Once you receive the check, many banks will allow you to scan or snap a picture to deposit it. You can also look into a custom solution that allows you to scan, collect, and reconcile checks. Some of these systems are quite costly, but the efficiencies you gain may be worth it if you process a lot of checks.

So, there you have it, four ways that you can avoid the ol’ “check is in the mail” trick, and ensure that your payments arrive in your bank account simply and easily.