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 Vincent Goldie, CEO, Newton Property Management. “In response to the rising costs impacting the property sector we’re digitising various aspects of the business, to improve the customer experience, make us more efficient and help management make more informed decisions.”

As part of this effort, Vincent spotted an opportunity: moving more customers to Direct Debit would reduce costs and improve cashflow, while increasing convenience for customers.

He chose GoCardless to make it happen and expects the benefits to include nearly two million pounds of improvement to cashflow over the three year project.

The more customers on Direct Debit, the better

Newton’s customers make quarterly payments to top up ‘float’ accounts used to cover expected expenditure, with any extra spend recouped on the next billing run. “If customers aren’t on a regular payment routine it’s challenging for cashflow, so the more customers we have on Direct Debit the better,” explained Vincent.

The trouble was, the Direct Debit system provided by Newton’s bank wouldn’t let customers pay the way they wanted, so take up was low.

“Customers want to be able to manage their payments easily and pay their bill in full on a preferred payment date,” said Vincent.

“But the bank’s system couldn’t keep up – between paper mandates and restricting collections to a fixed amount on certain dates, no wonder only a third of customers opted for Direct Debit.”

Clunky and time consuming

Instead most customers paid by credit card, bank transfer or cheque, which created cashflow challenges and unwanted admin for both customers and staff.

“It’s not convenient for customers to log-on or ring us every quarter to pay, and there's loads of opportunity for payments to be late or missed,” said Vincent. “For the non-Direct Debit paying customers, we also need a team of people to chase late payers. It's a heavy overhead.”

Managing Newton’s legacy Direct Debit solution internally was also anything but efficient, and it provided little visibility into payment trends.

“There was no reporting, no dashboards – nothing to support decision making,” said Vincent. “And because it couldn’t integrate with our billing system it took various imports and exports to action and reconcile payments. It was all very clunky, time consuming, and prone to error.”

GoCardless is streets ahead

Enough was enough. Newton decided to switch out its aging platform for a modern one that could provide a better customer experience and integrate directly with its billing system, CPL Software. Vincent had implemented GoCardless in two previous roles and knew its technology was up to the job.

“The GoCardless dashboard and open API infrastructure instantly transformed our visibility and reporting on payments, and we could start signing customers up digitally out of the box,” he said.

Millions in extra cashflow

The integration between GoCardless and CPL will see the two talk directly to each other, to trigger and reconcile payments and flag late or failed ones for credit control to follow up on. No manual intervention required. It will also allow customers to pay their full balance every quarter on a date of their choosing.

Vincent anticipates the impact will be massive.

“GoCardless will make life simpler for customers while freeing staff from literally days of admin time spent manually processing and reconciling payments,” he said. “It will also allow credit control to focus on proactively chasing debt, not late payments.”

No more cards thanks to open banking payments

Newton is also taking the opportunity to ditch credit and debit card payments completely, in favour of the faster and cheaper Instant Bank Pay from GoCardless, which is powered by open banking.

“Card charges are pretty expensive but Instant Bank Pay costs the same as Direct Debit,” said 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 and he believes any business could achieve similar benefits to those seen at 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,” said Vincent. “It will boost any customer service proposition by digitising and automating manual processes, freeing staff to do whatever the business or customers actually need.”