5 tips to get paid faster by your customers

Revenue is crucial for the survival of every organization. As per a survey among Small & Medium Enterprises (SME) in the USA, 30% of SMEs experience the negative impact of delayed payments. Poor revenue collection can cripple the functioning of an organization which no entrepreneur can afford. 

Read along for 5 tips to ramp up your collections & prompt payment by your customers.

1. Offer discounts for early payments.

An incentive to pay the vendor before the due date is called a cash discount. In many industries, cash discounts are extremely common. Astute clients prefer earning extra discounts for upfront payments. The seller gains liquidity and avoids costs associated with collection.

2. Levy late fees to get quick payments

Just like offering incentives for early payments, levying a late fee is another tool to collect timely payment. Not every organization possesses the resources to pay before the due date. In many industries, 1.5-2% interest/month is charged for the delayed payment.

3. Get paid in installments

The option to pay in installments helps to collect receivables faster. In many cases, the suppliers have collection agents who visit clients daily/weekly to collect pre-determined amounts. For a few clients, paying a huge amount is not feasible; in such cases, they prefer paying a small sum on a regular basis. To make it convenient, the seller can send an auto-debit option via Razorpay. Auto-debit reduces the workload as it eliminates the need for a reminder. 

4. Send reminders to overdue customers

Sending periodical reminders to overdue debtors remains a proactive method to get paid faster. Many vendors use automated systems to send emails or messages to clients stating the due amount along with statements. One needs to be cautious regarding the frequency of these reminders. Software like Quickbook helps to automate the reminder process with a one-click option.

5. Offering multiple payment options for customers 

As a business owner, it’s essential to know your clients prefer multiple payment options. By offering various options, you make it easy for clients to pay. This will help in timely & faster. 

Payment preferences vary across geographical locations. In China, for example, 65% of payments are done using mobile digital wallets like AliPay and WeChatPay. Similarly, in Brazil, the Boleto Bancario system accounts for 20% of e-commerce payments. Digital payment is bound to rise over the next few years. Netbanking options like NEFT and RTGS, UPI, digital wallets are becoming increasingly popular along with credit cards. Payment gateway like Razorpay offers these payment options.

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