Newton Property Management

Cashflow that’s safe as houses

Newton Property Management helps residents maintain the common areas on housing estates and in buildings. It currently has 35,000 customers across 1,200 sites.

“We find, instruct and manage contractors for anything from cutting the grass to putting on a new roof,” said CEO Vincent Goldie.

When Newton carries out repairs or maintenance, or enlists suppliers for utilities like common electricity, it settles those invoices directly before then invoicing its own customers. Making customer payments as easy as possible is vital for its cashflow. 

It’s here that Vincent spotted an opportunity. Moving more customers to Direct Debit would increase convenience, reduce Newton’s costs and improve its cashflow. Finding a more cost-effective alternative for one-off payments would also save on high card fees, and make it simpler to collect payments to cover extra costs or top up customers’ ‘float’ accounts.

The solution was to ditch cards and the bank’s legacy, user-unfriendly Direct Debit platform for recurring payments and Instant Bank Pay from GoCardless. This has set Newton on its way to realising millions of pounds in extra cashflow.

The more customers on Direct Debit, the better

Prior to working with GoCardless, Newton could only collect fixed amounts from customers on either the 7th or 21st of the month. Any extra it was owed had to be recouped on the next billing run.

Because the system wouldn’t let customers pay the way they wanted, only a third of customers paid this way. Most preferred credit card, bank transfer or check, which created cashflow challenges, extra costs, and unwanted admin for both customers and staff.

Enough was enough. Newton decided to switch out its ageing platform for a modern one that could provide a better customer experience and integrate directly with its billing system, CPL Software, to automatically trigger and reconcile payments.

“We're very grateful to the CPL team for building the integration,” said Vincent. “Their work has helped us to maximise all the features of GoCardless, including enabling payment on any day of the month — and any amount — as well as Instant Bank Pay and automated reconciliations.” 

On track to deliver £1.9m in extra cashflow

Newton now collects over 20,000 payments every month through GoCardless. Key to such high adoption has been the improved user sign-up and overall payment experience

Higher adoption means simpler collections for Newton and dramatically fewer failed or late payments, boosting cashflow and saving time on chasing customers.

“GoCardless has freed up pretty much a staff member's time for two, three days every single month,” said Callum Reid, Head of IT, Newton Property Management. “Failed Direct Debits are at an all time low — just 0.8% compared to 2-3% previously. Results like this mean we’re on track to hit our forecasted year-one savings of £80,000.”

And Vincent believes that’s just the beginning. “I believe we can double the number of customers on Direct Debit in the next 12 months,” he added. “If we do, GoCardless projects a cashflow improvement of £1.9m over three years, resulting from bringing our weighted days average overdue down from 37.6 days to just three.”

Exit cards. Enter open banking payments

Instant Bank Pay from GoCardless offers Newton the opportunity to ditch credit and debit card payments in favour of a faster and cheaper open banking-powered approach.

“We utilize Instant Bank pay to collect one-off payments and allow customers to top-up their ‘float’ accounts,” added Callum.

“Card charges are pretty expensive but Instant Bank Pay costs the same as Direct Debit,” added Vincent. “Getting all our card-paying customers onto Instant Bank Pay makes total commercial sense.”

The forefront of payments

This is Vincent’s third time adopting GoCardless across his career, so he knew the migration would be expertly handled. It also means he can confidently say that any business could achieve similar benefits to Newton.

"GoCardless is the number one in payments and it stays there by continually investing in its open API infrastructure and dashboard experience, compared to its competitors who haven’t enhanced their underlying tech in decades. It will boost any customer service proposition by digitising and automating manual processes, freeing staff to do whatever the business or customers actually need."