The Benefits of Integrated Payment Solutions for Professional Services Businesses
The professional services industry is made up of businesses and individuals who provide expertise and services rather than tangible goods. Some of the occupations that fall within this category include financial advisors, accountants, consultants, lawyers, and more. The global market size was valued at $5028.94 billion in 2020 and is expected to reach $7063.87 billion in 2025.
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For professional service providers, the billing process is integral to their business’s success, cash flow, and client satisfaction. And, having the right payment processing technology in place can make all the difference for the billing process. Unfortunately, many businesses find that their payment processing and bookkeeping cycle is burdensome, error-prone, and hinders cash flow.
The Payment Processing Needs of the Professional Services Industry
Like many other industries, professional service providers must seek out a way to manage invoices with ease and establish a reliable cash flow. The good news is that electronic billing solutions have helped to alleviate the burden and complexities of the invoicing process for professional service providers. Not only do these solutions simplify invoicing and account reconciliations, but they also improve the bill pay experience for clients.
Increasingly, professional service providers are finding that payment processing technology touches upon so many aspects of their business’s performance. In this white paper, we will explore the various needs and challenges faced by professional service providers as it relates to their payment processing infrastructure, and we will discuss some ways in which integrated payment processing solutions can address these challenges.
How Professional Service Providers Accept Payments
Traditionally, professional service providers have relied on a wide range of bill collection options, such as snail mail invoices, phone collection, online bill pay, and in-person card acceptance. In recent years, however, online bill collection has become the preferred bill pay method for both bill payers and service providers. While online bill pay has been a popular payment method for several years now, it has surged in popularity due to the COVID-19 pandemic. In fact, research shows that over 16% of consumers began using digital channels more often to pay bills once the pandemic started.² The future of electronic invoicing is bright, and the market is expected to grow by over $15 billion between 2021 and 2025.
Among the various payment methods accepted by professional service providers are checks, credit and debit cards, ACH, and mobile wallets. However, as online bill pay and electronic payment technology evolve, businesses are increasingly preferring digital payment methods over checks and cash. The benefits of digital payments are many: they create a faster bill pay experience, result in quicker funding, and can be easily connected to recurring payment plans to automate invoicing.
Payment Challenges for Professional Service Providers
Without the right infrastructure in place, processing payments can be a complex and burdensome process for service providers. This is especially true for businesses that are relying on outdated technology or practices to collect payments.
The following are some common obstacles faced by professional service providers when managing invoicing:
Complicated Account Reconciliations
Many businesses still reconcile their accounts manually, which entails tediously matching one’s transaction history with invoices. Without an integration of the payment processing system with the accounting system, businesses must manually reconcile these two operations. This process is time consuming and often leads to errors.
Burdensome Invoicing Process
In the absence of an electronic invoicing system, collecting payments can be quite the hassle for professional service providers. Businesses that accept check payments often mail out invoices, which adds a layer of administrative and postage costs. Plus, once the check is received, the business must take the time to deposit it and manually post it within account receivables. This process cuts into the service provider’s busy schedule and slows down the funding process, as the check has to be gathered, deposited, and cleared.
Phone collection is another common payment acceptance method that slows down workflow for businesses. It requires the professional service provider to reach out to their clients and then carefully take down payment information. Phone collection is tedious, prone to error, and time-consuming.
Even collecting card payments with a card reader can pose a challenge for businesses. If the payment processing software and hardware is not integrated with the business’s accounting software, then the service provider will need to manually enter the transaction information into their accounting system. And, of course, such transactions must occur in person, which may not be applicable for many business models.
Slow Funding
A reliable and fast cash flow is a must for any business, as it allows them to pay their employees and overhead costs. There are a number of reasons why businesses experience delays with funding — it could be due to limitations imposed by their payment processing provider, or it could be because of missed or late payments, as mentioned above.
Missed or Late Payments
In the majority of cases, customers miss payments not because of lack of funds, but because they procrastinated, forgot, or didn’t realize their bill was due.⁴ For business owners, these missed payments create a tremendous burden. Not only are they losing out on funds — either in the short-term or for good — but they also have to take the time to reach out to clients about their outstanding balances.
Negative Bill Pay Experience for Customers
To ensure that their clients are satisfied and that bills are paid on time, it’s essential for service providers to make it easy and convenient for customers to pay. Outdated and cumbersome bill pay options are unfortunately all too common, and they directly affect cash flow as customers may postpone or completely avoid making a payment. As payment preferences change among consumers, online bill pay and mobile wallets are increasingly preferred. It is essential that service providers give their clients hassle-free bill pay options. We will discuss such bill pay options later in this white paper.
Addressing Payment Challenges With Integrated Technology
As payment technology continues to advance, the benefits of integrating with a payment gateway are tremendous for professional service providers. With one seamless integration into their business management software, professionals can reap the benefits of advanced payment technology.
Here are some of those benefits:
Ability to Accept a Wide Range of Payment Methods
By allowing customers to pay with the method of their choice, service providers can improve the client bill pay experience and the collections process. Especially as customers develop new preferences for payment methods — for example, mobile wallets and ACH — it is essential that service providers support a broad range of payment methods.
Advanced Invoicing Solutions
There is a wide range of online bill pay solutions on the market. While some online bill pay solutions allow the service provider to enter in payment information through a virtual terminal, others are designed for the client to pay on their own — for example, through an online bill pay webpage. Customers increasingly prefer such options as it gives them the ability to pay at their convenience, and it doesn’t require a trip to the post office to mail out a check. At the same time, businesses benefit from faster funding and fewer late or missed payments.
Recurring Payment Processing
A considerable benefit of online bill pay options is that they often support secure storage of customer payment information and recurring payment schedules. This means that the client only has to provide payment information once, and it can then be applied to future transactions or to a custom recurring payment plan to automate invoicing.
Account Updater Tools
To reduce the odds of missed or late payments, many online payment processing solutions feature account updater tools that will automatically detect any inactive or expired cards stored on file, and then provide the updated card information — thus significantly reducing the number of declines.
Faster Funding
There are many ways in which a payment integration can speed up funding. For one, online bill pay solutions are much faster than the drawn-out process of accepting and depositing checks. Additionally, the payment method itself can affect funding times; Automated Clearing House (ACH) payments boast a fast turnaround time, and there are next-day and even same-day credit card funding options offered by some payment solution providers. With today’s technology, there’s no reason why a business should have to wait more than a few days to receive their funds.
Experience the Cardknox Difference for Professional Service Providers and Industry ISVs
Cardknox offers the professional services industry multiple advanced payment acceptance options, along with industryleading customer service and the most competitive processing rates. As the bill pay experience digitizes and service providers become increasingly reliant on online solutions to streamline operations, Cardknox technology is here to help businesses adapt.
Here’s a look at some of our many solutions and features:
Cardknox Payment Integration
Businesses can integrate their accounting software with the Cardknox gateway to accept and manage payments right from their system. With the help of Cardknox’s robust SDK, it is easy for developers and ISVs to equip third-party systems with the benefits of Cardknox payment processing.
For businesses that prefer to accept payments in person, the Cardknox gateway supports a wide range of payment terminals. These terminals accept leading payment methods such as EMV, magstripe, mobile wallets, and contactless cards.
Cardknox Standalone Processing Solutions
In addition to a Cardknox gateway integration, Cardknox offers a number of standalone electronic processing solutions that are perfect for managing online bill pay:
The Cardknox Merchant Portal
The Cardknox Merchant Portal is a virtual terminal that provides businesses with all the tools they need to accept and manage payments online. Users can process one-time or recurring payments, securely store customer information, monitor transaction history, generate reports, send email invoices, and much more.
PaymentSITE
PaymentSITE is a customizable online form that can be embedded into an existing website or set up as a standalone webpage for accepting payments. Perfect for invoicing, the PaymentSITE form can be shared with clients via its unique URL. It’s a great option for businesses that want to accept credit card or ACH payments online without having to build an e-commerce site. Plus, it’s secure and fully PCI-compliant.
Cardknox Mobile App
The Cardknox Mobile App allows service providers to process payments anytime and anywhere. Users can key-in card information, capture card information with their mobile device’s camera, or swipe or dip the customer’s card using the compatible card reader device. The app is fully synced with the Cardknox Merchant Portal, and it has functionalities for viewing transaction history, adjusting past transactions, setting up recurring schedules, and more.
Convenience Fees
By adding a convenience fee to invoices, service providers can offset the costs of credit card processing. Fortunately, with Cardknox it’s easy to implement convenience fees — users of the Cardknox Merchant Portal can set up a convenience fee that’s automatically applied to transactions.
Note that rules and regulations govern the use of convenience fees. Typically, businesses are only allowed to levy a convenience fee if they offer an alternative bill pay option that doesn’t include an attached fee.
Support for a Wide Range of Payment Methods
All Cardknox payment solutions are compatible with today’s leading payment methods. This includes magstripe, EMV, and contactless cards; mobile wallets; ACH; and more
Recurring Payments and Card Updater Tools
Cardknox’s recurring payments tool — available through the Cardknox Merchant Portal or via an integration with Cardknox’s recurring API — is a powerful feature that automates the invoicing process. Service providers can easily set up custom payment schedules for clients with the desired payment method, amount, frequency, intervals, and more. With this easy-to-use solution, businesses can eliminate the hassle of repeat payments while improving the customer experience.
Another benefit of Cardknox’s recurring payments solution is that it works in conjunction with our card updater tools to prevent lost sales. Cardknox Account Updater automatically scans cards on file to detect those that are inactive or expired, and it then obtains the correct information from the card issuer and applies it to the system. Cardknox UpdateYourCard automatically contacts the cardholder to request updated card information in the event that Account Updater was not able to resolve the issue.
Prepare for Success With Integrated Payments
Now more than ever, payment technology holds the key to success for professional service providers and ISVs. With the professional services industry undergoing an exciting period of growth, now’s the time to supercharge your business with payment technology. Experience optimized invoicing, lower processing rates, and nextlevel customer satisfaction with one easy integration. Contact us today to learn more!
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