The solution to credit customers : Autodebit

 

Autodebit feature is a must-have feature for automating your accounts receivables process especially when you have a lot of credit customers.Autodebit allows you to automatically pull funds from your customer account  based on certain conditions being met.

For eg : Some of the conditions could be as below

• Autodebit on the date the Invoice is due
• Autodebit after x days after the invoice is generated
• Autodebit Invoices of less than xxx $ value

Autodebit can be set up for both credit card payments as well as bank to bank transfers in most countries

How does Auto debiting help your business

• Your team’s productivity gets improved and your team can focus on other issues such as disputed invoices or overdue invoices instead of following up or sending reminders to customers who are likely to pay on time
• Your credit customers need not take any action to pay you as it is automated
• Your company’s DSO (Days sales outstanding ) and cash flow is in better shape
• First time/Risky credit customers who you are not sure would pay on time can be set up on Autodebit using their bank account numbers.This will reduce the risk you will be taking up
• Eliminates time-consuming reconciliation of payments and remittances as this is taken care of by the software

 

How does it help your credit customers?

By setting Auto debit instructions it’s not just you that is benefiting but your customers too.

Hassle free way to pay you: Customers who are making repeated purchases and would like to avoid the hassles of taking manual actions to pay you.opening a portal, entering card number or bank account number would find the functionality of Auto paying a life saver

Take Advantage of discounts provided by you: most B2B companies provide discounts to ensure its customers pay on time.These discounts could be from 1% to 2 % for NET30 (payment term which specifies early pay discount if paid within first 30 days).On an invoice worth 1000 dollars this could be up to 10 -20 US dollars.By setting an Autodebit instruction you customer could thus save money!

Blocked orders: Every customer hates blocked orders.Mostly likely reason for blocked orders is non-payment of dues due to various reasons such as – lack of communication of overdue invoices.

How to ensure that your customer pays you through Autodebits ?

For a repeat/longrunning customer

Enable/Disable Autodebit: Ensure that the customer knows that they can setup Auto-debit instructions with you through a portal.Also, allow the customer to stop Auto debit or reverse a payment if they want at any time using a portal.
Allowing the customer the above flexibility will make them more receptive to switch to autodebit as they have the option to stop/reverse autodebit at any time

Provide special discounts: Provide special discounts to customers who are paying through Autodebit.Auto debit reduces the number of man-hours spent by your team and also gives you the ability to have a predictable cash flow.By passing on a part of the benefits to your repeat customers in the form of discount you will be able to switch them to pay you through Auto debits

For first time /Risky customers

Credit payments are a part and parcel of any B2B business: The challenge with any credit payment is that there is no surety that you will be paid on time.By requesting your first time customer who requires 30 days / 45 days credit to setting Auto-debit instruction with you, You will be reducing the risk you are taking.

 

See other ways you can ensure your customers pay you on time