- Modern consumers demand convenience, security, and flexibility when paying for their goods and services, and like it or not; legal clients are no different.
Modern consumers demand convenience, security, and flexibility when paying for their goods and services, and like it or not; legal clients are no different. If your firm fails to provide the payment options that modern clients want, you risk falling short of client expectations. Poor client experience can snowball into a whole host of problems for your firm, including poor client retention, little to no client referrals, and ultimately hurting your law firm’s profitability.
The following information will help you choose and implement the lawyer payment methods your clients prefer.
The trend of clients paying their legal fees online or with a credit card is undeniable, but are lawyers allowed to accept payments online? Short answer: yes. However, there are a few implications to consider.
It’s not inherently risky for attorneys to accept payments online, but they still have to comply with all the legal and ethical requirements. In particular, lawyers have struggled with using electronic payment solutions while complying with the rules requiring the separation of client and third-party funds from the lawyer’s operating funds. However, using a legal payment solution like LawPay, explicitly made for attorneys and the legal industry, is the best way of keeping your transactions above board and secure.
Credit card processors, also called merchant service providers or acquiring service providers, administer a service so you can accept credit card payments at your business. In many cases, business owners choose a credit card processing provider by comparing a few companies — Paypal, Stripe, and Square, for example — and selecting the best one.
Credit card processing for lawyers is a little more complicated. As we established above, accepting credit card payments for legal services evokes several ethical rules. Lawyers must ensure that their credit card processors will keep them in compliance.
LawPay’s legal payment platform lets lawyers separate payments into earned and unearned funds and direct them into their proper accounts. In addition, the solution deducts the processing fees from the lawyer’s or firm’s operating funds rather than from funds that may still legally belong to the client or a third party.
Using a legal payment solution built specifically for attorneys and the legal industry, like LawPay, is the best way of keeping your transactions above board and secure.
Before you begin exploring how you can build your law firm’s online payment processes to cater to the modern legal landscape, we invite you to enter the mind of a standard legal client. All of the following are questions current and potential legal clients frequently ask.
No surprise, money is top of mind for many legal clients. As a legal professional, you want to help your clients and offer top-notch service. But at the end of the day, you are performing a job, and you need to collect the money you are owed.
To ensure your clients feel prepared to incur the costs associated with legal representation (and so that you don’t find yourself in a situation chasing down unpaid invoices), it is essential to be clear and transparent with your costs. Reviewing the type of payments you accept, the frequency of payment, your hourly rate, flat fees, and how you’ll collect payments from your clients are all critical questions to answer during your client onboarding process. This way, there are no surprises!
Additionally, you’ll want to ensure that your rates are commensurate with your geographic location, target client demographic, and your area of law and experience. Lawyers don’t always determine the appropriate value for their services or fail to adjust rates to keep up with changing economic times. That’s where doing your research comes in! By asking colleagues, mentors, and other legal professionals in your area how much they charge, you can compare your law firm’s billable rates for different types of cases with other legal professionals in your geographic region who handle similar cases.
You might consider looking at data on employment via the Bureau of Labor Statistics, which shares the average salaries for lawyers across the country. Some state bar associations also publish industry trends on salary, breaking those down further by law firm type and practice areas.
It’s important to reiterate that today’s consumers value varied and flexible payment options. That’s why we recommend offering as many ways to pay as possible. Review the following lawyer payment options to discover all the payment methods available, and learn the pros and cons of each one.
Offering online credit card payments is one of the best options for law firms for multiple reasons:
Online payment systems, like PayPal, are important to consider when law firms are choosing which payment options to provide to their clients.
An electronic check—or eCheck—serves as a digital version of a traditional paper check. NOTE: To accept eChecks, law firms must use an online payment solution that includes eChecks as a payment method.
Fee Funding is a type of short-term financing that allows consumers to make purchases and pay for them at a future date, often interest-free. Since 2020, the popularity of this type of payment has exploded, with 50% of Americans using fee funding to make a purchase. Through legal fee funding, clients can pay for services over time while the firm receives the total amount upfront.
Offering a greater variety of payment methods leads to faster payments and stronger cash flow. In fact, data shows that law firms offering flexible payment options save 3 billable hours daily, increase profitability by 10%, and receive payments 32% faster. By accepting multiple online payment options, law firms make it easier for clients to pay, which can help grow their practice. Providing various convenient lawyer payment methods is one way to prioritize the client-centered experience.
A successful law firm must have streamlined and transparent billing practices. More likely than not, you know how important it is and have taken steps to reduce inefficiencies in your law firm’s billing processes, but how? Simplifying your billing can be as easy as 1, 2, 3.
When building a billing process that works well for you and your clients, an all-in-one billing payment solution is the best place to start. By connecting your billing process and payments, you can create smooth, streamlined workflows to save time and money on your billing and collections process.
Although today’s technology offers many possible payment options for law firms, not all options are appropriate for all firms. Finding a solution that integrates with other systems is essential for many law firm tools (such as practice management or accounting software), allowing them to accept multiple payment methods in one solution.
LawPay functionality makes it easy for law firms to accept secure legal credit card payments online. The following LawPay features are just some ways your law firm can streamline its payment processes and keep your life a little simpler while increasing your cash flow and client satisfaction.
Before implementing digital payment methods, law firms should research their state bar’s rules and regulations and any ethical considerations.
LawPay empowers you to offer a wide variety of the latest payment options to your clients. If you’d like to see how our modern payment platform can benefit your firm, we invite you to schedule a demo today!