As announced at last month's Product Round-Up 2019 event, Commusoft now supports deferred payments.
Deferred payments allow you to get paid quicker, increase cash flow, and avoid debts by placing a block on a set amount of funds on a customer's card. The card can then be charged by the engineer on site, once an invoice has been raised. This is an experience you should already be familiar with - for example, hotels and other services do this all the time - why not field service businesses too?
Taking deferred payments at the start of the job is a good practice as it removes the possibility for late or non-paying customers and ensures that funds are available. You can choose on a customer-by-customer basis whether or not a deferred payment is required and how much will be blocked. This gives you more control and power to ensure you get paid in a timely manner, ultimately reducing debt.
Keep reading to find out:
- What is placing a block on funds?
- How are card details stored?
- Setting up and using deferred payments
- More tips to reduce debt with Commusoft
An important aspect to successfully using deferred payments in your business is ensuring that your customers understand why you are asking for their card details and what a deferred payment is.
You need the customer's card details in order to put a 'hold' or 'block' on an amount of funds relating to the job. You will need to decide upon the exact amount and communicate this to your customer first. For example, it could be a flat-rate call out fee, a percentage of the total, or even full payment (likely for smaller work).
This block guarantees that the customer has the funds available and allocates them for your business, but it does not take the funds from the customer at this stage. Additionally, by recording card details at this stage, you remove the need to ask for them again at a later date.
When an invoice for the job (partial or final) is raised, the amount blocked on the card can be added against it as a payment. The customer's card will then be charged.
Customers may want to know how you store card details (and rightly so). The most important thing to remember is, neither Commusoft or your business actually store card details. Those are stored by Stripe and Worldpay (depending on which service you use) and are securely held to all the required regulations and security standards, e.g. PCI compliance.
As Commusoft does not store card details, users cannot view the customer's payment information. When a card is charged, the card details are shared via a token (an algorithmically generated number which acts as a placeholder for the actual information), allowing for sensitive data to be securely sent via the internet. This is a standard procedure for electronic payment systems and online banking.
Multiple payment cards can be saved against each customer and can also be deleted at any time, if required.
Now you understand how blocking funds works and how card details are stored - how do you set this up within Commusoft?
To start using deferred payments there are a few things that need to be set up first, as well as several rules for staff to follow. Make sure you fully review each section below to successfully implement deferred payments in your business.
- Credit card integration
- Enabling deferred payments
- Adding a deferred payment to a job
- Invoicing and finalising a deferred payment
In order to use deferred payments, you must have a credit card integration set up or you will not be able to store or charge payment cards. You can do this with either Stripe or Worldpay. Head over to Company Settings > Credit card to link your account.
Please note, Stripe and Worldpay may hold deferred payments for different amounts of time. This is typically around 7 days, however, you should check with your provider at the time as this is subject to change and is out of Commusoft's control.
If blocked funds are not charged (triggered by adding a payment to an invoice) before that amount of time expires, the authorisation will be cancelled and funds released. This means that deferred payments is not an ideal solution for jobs with long time frames.
It is also very important to note that deferred payments may be charged with two transaction fees by Stripe and Worldpay. We recommend you speak to your payment provider in order to clarify any transaction fees.
Once you have the credit card facilities enabled you can turn on deferred payments. From System Settings, navigate to the Jobs section and locate the Credit card details setting page.
You'll see the screen below, where you have several different options to pick from.
- Don't record details when creating a job
This is the default option. It is not possible to add credit card details when adding a job.
- Record card details when creating a job, but make it optional
Card details are not required, but can still be added. Deferred payments are not possible.
- Record details when creating a job and make it mandatory
A job cannot be added without payment card information. Deferred payments are not possible.
- Record card details when creating a job, make it mandatory, and allow deferred payments
- Take payment at the time of booking the job
- Take payment at the time of booking the first diary event
Card details are always required in order to add a job. Deferred payments are possible (but optional) by setting the amount to be paid at the time of adding the job. You will need to choose between two additional options to select when the block will be placed on funds - either when a job is booked, or when the first diary event is added.
To enable deferred payments, you need to select the final option and then choose your preferred time for deferred payments to be taken. Make sure to click 'Save' once you're finished.
When adding a job from the customer screen via the web application, you will now see the card details section below the regular job details. This is where you enter the customer's card details and specify the deferred payment amount (£) to be taken. Be aware that a deferred payment cannot be added to a job via the mobile app.
Please note, with deferred payments enabled, you cannot add a job without first adding the customer's card details - it is mandatory. However, if you do not wish to take a deferred payment for a particular job, simply enter the deferred amount as '0' and no funds will be held.
If you've already added a card against a customer (or multiple), you will instead see a dropdown list and the option to add an additional card. This allows staff to quickly select a previously provided card for both their and their customer's convenience.
Only the type of card (Visa, Mastercard, etc.) and the last 4 digits are shown to the office staff. This allows them to ask the customer whether it is okay to make the charge on the "Visa card ending in 1234", for example, whilst still protecting the customer's card details.
Once you have added the job with the deferred payment, the funds will be blocked on the customer's card. You will notice a banner across the top of the job screen notifying staff that a deferred payment has been made against this job.
Imagine you've added a job with a deferred payment of £100. You've visited the property and completed the work and the job required an additional £50 of parts. Therefore the invoice would be raised for £150.
Remember, the £100 deferred payment is only being held on the customer's card and is yet to be charged. To finalise the payment and charge the card, a payment will need to be added against the invoice within Commusoft. This tells the payment integration to capture the funds and finalise the transaction.
The ideal workflow is for engineers to add and finalise payments via the mobile app, though it is also possible via the web.
Engineers via mobile app
Once an engineer has completed work, they can immediately raise the final (or partial) invoice from the job site and ask the customer to finalise their payment. The engineer simply creates the invoice like normal and selects 'Add new payment'.
The app will display a notification letting the engineer know that a deferred payment has been held for this job and asks if they would like to take payment using this card. They can select 'Yes' before finalising the payment details. If there are additional charges (e.g. £100 deferred payment, £150 total invoice) these will be charged to whichever card is selected at this stage. The amount charged should be set as the total invoice amount (including deferred value), not just the additional charges.
Before the payment is finalised the customer will need to sign it off. If you wish to add a custom message to the signature screen, this can be set up in System Settings > Payment authorisation message.
What if the deferred payment equals the total charge?
If the deferred amount equals the total charge for the work, a payment will still need to be added against the invoice. If the invoice total is £100, the engineer should add a card payment of £100. This will trigger the deferred payment to process and will not double charge the customer.
What if the deferred payment is more than the final charge?
If for any reason a final invoice is lower than the deferred payment (e.g. £100 deferred but only £50 final invoice) the difference will be released and not charged to the customer's card. In this example's case, £50 of the £100 being held would be charged and the other £50 would be released.
Is this compatible with the online invoice portal?
Deferred payments has not been designed to work with the online invoice portal. If a deferred payment was taken, but the customer subsequently paid via the online invoice portal, a new charge would be made on the card and the deferred payment would be left to expire. Whilst not overly problematic, this unnecessarily places a block on the customer's funds and is not recommended. If using deferred payments, you should aim to finalise payment using the deferred process, not via the online invoice portal.
Store credit card details
If you're not ready to start taking deferred payments, one option is to at least record the card details at the point of booking. You can make this either optional or mandatory in System settings > Credit card details. Before a job, customers tend to have more time for you and are willing to provide details. Once work has been completed and their problem is fixed, it can be easier for customers to dodge your calls or be "too busy right now". If your team can simply call up and ask to charge their Visa ending in 1234, it's quicker and easier for everybody involved.
Send invoices via Commusoft's online portal
Commusoft's invoice portal gives customers the ability to receive and pay their invoice online. Whether on a desktop, laptop, tablet, or smartphone, customers can pay by credit or debit card immediately. This is convenient for customers and helps you get paid more quickly. Learn more.
Take payments on site
Another way to get paid quickly is for engineers to take payment on site. Whilst, this can essentially be achieved through deferred payments, another option is by using SumUp to accept card payments on the go with a portable payment terminal. See more.
Make estimates more effective
Earlier this year, Commusoft improved estimates to make them more robust. Estimates can now require customers to sign to accept, the signature can be displayed on the PDF, and the document is clearly marked as accepted. This highlights to the customer their commitment when they accept an estimate. Additionally, you can add a custom disclaimer to your estimates to clarify any T&Cs that the customer may be agreeing to, such as a cancellation policy or anything else you see fit. Find out more.
By taking deposits before you start work, you set an expectation to the customer about getting paid. Deposits can also be used to ensure that costs for parts and materials are not coming out of your own pocket. It's advisable to create a policy and then to stick to it - you could even have multiple policies, e.g. for work under £200, over £500, and over £1,000 with different deposit amounts.
To take a deposit in Commusoft, you can add an initial to the estimate you send to the customer. Once the estimate is accepted, an invoice will be automatically raised for the amount. If you are using the online estimate portal, the customer can pay immediately online. Remember - if the customer won't pay a deposit, perhaps this isn't the sort of customer you want to work with. That takes us to our final point...
Be willing to fire customers
You can decide whether you want to conduct work for particular customers. If they've paid late (or not at all) in the past, you should evaluate whether they are worth your time. This applies even to new customers - if there are red flags that this customer may be trouble, consider if you should steer clear. It's okay to trust your gut!