Getting Money from Customers – Your Payment Options

There are lots of different ways that you can get your customers to pay you. It is a matter of thinking about what works best for your customers and you, as well as what you can actually set up and use.

What payment methods will you offer your customers?

CASH

This is probably the easiest, to begin with. Cash works if you are in front of your customer at the point of purchase, like at the markets. Always make sure you have change!

CHEQUE

You can allow customers to pay you via cheque. They will make the cheque out to you (your full name) or your business name, depending on how your business is set up. If you are running as a sole trader under your own name and your bank account is under your name, then ask your customers to put your name on the cheque. If you have a business bank account under the business name then ask your customers to put the name of your business on the cheque.

You will need to go to the bank and deposit the cheque to then get the money transferred into your account. This can take a few days to “clear” (ie: where they check the other person has the money in their account and takes it out to then put into your account).

Sometimes people make write cheques when they actually don’t have the money; which you wouldn’t know. And so their cheque will “bounce” (your bank will tell you that the cheque was dishonoured and they could not get the money from the person’s account ) and your bank will charge you a fee for this. It is then up to you to chase up the person to ask for your money, again. However, most of the time cheques are totally fine and quite easy for your customers.

DIRECT DEPOSIT

You supply a Tax Invoice that outlines to your customer what you are charging them for with your ABN (Australian Business Number) and your bank account details (Account Name, Bank, BSB Number) to your customer and they use internet banking to deposit the money directly into your account.

This is a very popular method now with internet banking. It means you don’t have to set foot in a bank – yey, no lines! Plus it is quite instant, you can sometimes have your money within 1 day, if your customers are super nice and pay you straight away.

CREDIT CARD

You may like to offer your customers the option of paying by credit card. This will mean that you have to set up a Merchant account with a bank, which will cost you money. And the bank will take a fee for each transaction that you put through. You will need to do your research to get the best deal from a bank.

PAYPAL

If you don’t want to go through the banks and set up a Merchant account, particularly at the beginning, then use PayPal. through PayPal you can take payments online, as well as orders from people using their credit cards which you then put through the PayPal system.

Yes, PayPal does take a fee on each transaction, so do your research and see if that works out for you and your pricing structure to ensure you are still making money.

Here at The Frank Team we take cheques & Direct deposits for our workshops that we do with various clients (schools, uni’s, community groups, local councils, government departments & young professionals). But for our products we use PayPal which means we can take credit card payments, which is great flexibility for us and our customers.

With any payment method always be totally up front with your customers about your payment terms; when you expect to be paid, how & how much. Here at The Frank Team we take a 60% deposit before the workshop and then 40% after the workshop, and have 14 day terms (ie: our customers have 2 weeks to pay).