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How much time and money could you save on payment collection?

GoCardless
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Last editedMay 20223 min read

If you think you spend too much time and money in your business on payment collection and associated administration, you are probably correct. For most businesses, these unnecessary costs are caused by the payment methods employed.

Switching to GoCardless saves businesses time, money, and a whole lot of stress!

How GoCardless saves you time and money on payment collection

GoCardless offers merchants set-and-forget, account-to-account payment collection and automates financial admin in just a few clicks.

Using pull-based payments, GoCardless puts your business in control of when you get paid, eliminating late and failed payments and automating financial reporting - all at a lower time and money cost than your current payment methods.

"Managing memberships and processing payments used to take two to three full weeks a month now that’s down to just 1 or 2 hours a week." - Tom Marien, Owner, One Element

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1. Save time chasing late payments

Many businesses, particularly B2B businesses, send invoices to customers and receive payment via a manual bank transfer.

This payment method leads to multiple problems which can have a catastrophic impact on a business.

One of the most significant issues with invoicing is that it often results in late payments. On top of the cash flow problems that late payments cause, businesses are required to divert valuable resources to chase the payments and deal with the associated admin. 

Research by Tide found that the average UK SME spends 30 hours a month chasing late payments.

Solution

GoCardless offers a flexible, automated payment collection method that puts your business, not your customers, in control of incoming payments. Set-and-forget automation eliminates late payments, meaning no more time wasted chasing late payments..

As a result, GoCardless merchants spend 90% less time on late payment admin than the average business.

"This has saved us a whole person's salary." - James McGlade, Founder, Growth Alliance

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2. Save time on regular financial admin

Invoices create a lot of manual admin, even when they are paid on time.

Invoices must be created, sent, and then manually reconciled when paid, which requires significant amounts of time to be spent on accounting admin; the same is also true if a business uses credit or debit cards to collect payments.

For businesses collecting payments via credit or debit cards, the high failure rate of card payments creates further admin, including the time spent recovering these failed payments and completing manual bank reconciliation. 

A recent study by Starling Bank found that sole traders and SMEs spend between 19% - 31% of their total weekly work time dealing with payment admin due to the use of these inefficient payment methods!

Solution

GoCardless delivers significantly higher rates of payment success compared to cards with direct account-to-account payment collection. While card payments fail at a rate between 10% - 15%, GoCardless merchants enjoy a payment success rate of 97% - 99.5% which reduces the need for manual admin.

GoCardless offers over 300 accounting software integrations allowing merchants to automate bank reconciliation and other financial admin tasks. As a result, GoCardless merchants spend 59% less time on financial admin in general.

"Eliminated 14 hours per week, per team, that was previously spent matching payments, equating to around £2,000 per month per venue in staff salaries." - Lee Mellon, Head of IT, Cripps & Co.

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3. Save money chasing late and failed payments

Accepting card payments requires you to pay fees for every transaction (more on this below). Furthermore, the high failure rate of card payments results in missed payments and lost customers, costing your business even more money.

While payment collection via invoice & bank transfer may appear to be free, there are significant time costs for a business, ultimately costing money for staff time to chase late or missed payments. 

Research by Forrester has shown that the monetary cost of chasing late and failed payments is 11% - 15% of the value of the recovered funds. 

Solution

With GoCardless’ high payment success rate and automated collection method, payments are always paid on dates set by yourself, eliminating late and failed payments and the costs associated with recovering them.

"Not only has GoCardless given us much more freedom when it comes to collections, but it has also saved us money." - Lee Drayton, Managing Director, LD Fitness

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4. Save money on transaction fees 

Card payments incur notoriously high costs on your business as they charge multiple fees on each transaction.

Taking card payments as a business means you'll pay a number of related card processing fees. These include transaction fees (typically between 1% and 3%), authorisation fees (between 1p to 3p per transaction), merchant service charges (typically between 0.25-0.35% for debit cards, 0.7-0.9% for credit cards), and more

Exactly how much you are charged depends on a few factors, including the type of card your customer uses, making it difficult to arrive at a precise amount. These costs can quickly add up, but cannot be accurately predicted due to the variations in fees for different card issuers and processing providers.

Solution

GoCardless, by contrast, offers transparency and cost-effective pricing compared to accepting card payments.

Not only is GoCardless cheaper, but we also provide pricing transparency. Accepting a £500 card payment will cost a merchant between £7.50 and £15, depending on various factors. However, with GoCardless, that transaction costs just £4.

Read more about GoCardless pricing here.

“Automating payments and all their related workflows, for a fraction of the per-payment cost of card payments, is a massive win for us.” - Lee Mellon, Head of IT, Cripps & Co.

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Setting up payments with GoCardless

Accepting payments with GoCardless saves you time and money, is quick and easy to set up, and can be used for recurring or one-off payments.

There are no set-up fees and no contracts or commitments required to get started, and with GoCardless, you can start taking payments in less than a day.

GoCardless merchants have a clear view of incoming payments and visibility on who has/hasn't paid through the user-friendly GoCardless dashboard.

GoCardless also offers seamless integration with over 300 partners, including major invoicing software like Xero and QuickBooks, which puts payment visibility right into the workflow of your business.

Not only does GoCardless save you time and money, but it also speeds up payment times. Research has established that businesses can get funds into their account almost twice as fast by accepting GoCardless payments.

Save time and money by automating payment collection with GoCardless and get paid on time, every time!

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Interested in automating the way you get paid? GoCardless can help

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