Want an easier way than printing invoices and tearing off payment slips? Xero's Pay Now feature could be what you're looking for.
One feature of the Xero cloud accounting software that has drawn our attention is the way you can send an electronic invoice with a link your customer can click to make the payment.
That simplifies the payment process for your customers, encourages them to pay promptly, and allows those payments to be automatically recorded in Xero.
As well as your customers being able to pay this way using PayPal and DPS Payment Express, this 'Pay Now' feature has now been enhanced to let your customers pay by credit card too, using an eWAY payment gateway. From the conversations we've had, eWAY seems to be more popular among Australian small businesses than Payment Express, though we haven't actually seen nany firm numbers to back that up.
The advantages of using eWAY over PayPal include:
- businesses normally receive next-day settlement into their bank accounts
- a direct credit card payment gateway has a more 'professional' feel than the consumer-oriented PayPal (business customers may be less inclined than consumers to set up a PayPal account so they can pay via credit card)
- depending on the volume and value of transactions it may be cheaper than PayPal, though you must remember to factor in your bank's charges for the credit card facility. Businesses that are already eWAY clients - typically for their web stores - face no additional setup costs.
One early adopter of Xero/eWAY integration is Rural Business Magazine. Co-owner John Forrest said it took five minutes to set up Xero to handle credit card payments with eWAY, and then "I sent out this month's invoices through Xero at 8am and I started receiving notifications of payment at 9am!"
"It has really simplified the payment process," he added. "I send out the invoice via email in Xero, and the payments come in. Before we had to print the invoice and tear off all the payment slips, now it's online and easier. We get paid faster."
That reasoning also applies to collecting payments via PayPal or Payment Express.
While most small businesses are careful about managing cashflow, we can see that if they knew that a transaction would be on the same credit card statement whether they paid immediately or on the due date, theyd be more likely to pay straight away, especially as the Pay Now link makes it quick and easy to do so.