In today’s business world , companies that accept payments on account strive for more efficient payment processes and better cash flow. This trend extends across several sectors, with companies that serve many retail customers in particular, such as childcare organisations and energy companies, stand out. A growing number of these companies are using online payment options in their credit management software, making it faster and easier for customers to pay.

Switching to online payment options

Traditionally , the payment process for many companies, including energy companies, is through invoices and direct debits. While this usually works well for most customers, situations can arise where collections fail, for example due to insufficient balances in bank accounts. This leads to payment delays and the need for reminders and dunning letters to customers. To address these challenges, companies have increasingly implemented online payment options, such as sending text messages, e-mails and even QR codes in letters.

This approach allows companies to be proactive and provide customers with more targeted reminders. In the past, customers had to enter all the details themselves in their bank after receiving a letter, which was perceived as cumbersome and time-consuming. This often resulted in delayed or even forgotten payments. However, adding a payment link to e-mails, text messages or even QR codes in letters significantly lowers the threshold for customers to pay immediately. The convenience and immediacy of these payment methods increase the likelihood of customers paying on time and helps avoid payment delays.

Thanks to online payment options, businesses can therefore be more responsive to customers’ needs and significantly improve the payment experience. By offering optimised payment methods, businesses can minimise the risk of late payments and ensure a smoother and more efficient payment process for both themselves and their customers.

Proactive approach for payments

As mentioned earlier, an effective approach to optimise the use of online payment options is to be proactive. In situations where direct debits fail, invoices are paid manually or payment delays occur, companies can send payment requests via text messages or e-mails to remind customers of their payment obligations. This method often proves more effective than reminders by post. Moreover, text messages have often been found to be even more effective than e-mails, as they are read faster and followed up better.  

The large number of e-mails people receive these days, makes it easy to miss an e-mail or for it to get lost among all the other e-mails . In comparison, people are less likely to receive text messages, making them more impactful and more likely to prompt people to pay. However, it is important to note that some people may be initially sceptical about receiving a reminder with a payment link via SMS. But once they get used to it, it proves to be a very effective reminder method.

This integrated process in their credit management software allows companies to receive payments on time and minimise payment delays. Proactively sending payment requests via text messages or e-mails ensures that customers are immediately reminded of outstanding payments. This automated and personalised approach increases the likelihood that customers pay on time and contributes to a smoother payment process. Minimising late payments not only results in improved cash flow for businesses, but also boosts customer confidence and satisfaction.

Optimisation and integration of payment processes

The success of online payment options can be measured by extensive reporting in the credit management software. Although the number of successful payments may be high at the beginning, it may decrease as the dunning process progresses. However, this is usually due to customers’ individual circumstances and not the chosen payment method itself. To tackle late payments effectively, it is important that companies show understanding of customers’ situation and encourage them to contact them to make payment arrangements.

Advanced automation and integration

As a result of these positive developments in the receivables management process, companies are seeing the benefits of further automation. By using advanced payment APIs, they can further streamline the process and integrate it into their existing systems. This provides a more efficient and seamless payment experience for both the organisation and customers.

Creating a smooth payment experience across various industries

All in all, online payment options have significantly improved the credit management process of companies. By offering customers choice and ensuring ease of payment, preventing late payments and creating a smooth and efficient payment experience. The use of varied payment methods, combined with understanding customers ‘ situations and payment arrangements, contributes to a successful approach to late payments in various industries, including childcare and energy companies.