Accepting Credit Cards In Your Law Firm 2022

Accepting Credit Card Payments in Your Law Firm8For these reasons, many law rms prefer the consistency of eCheck. You still get theluxury of automatic withdrawals, but instead of a credit card number you use a bankaccount and routing number. The rate is lower and remains the same all the time.One major di erence between taking money by eCheck versus credit cards is theamount of time it takes for money to hit your bank account. When you accept creditcards, your payment is funded as soon as the next day. eCheck payments, on the otherhand, can take two to three days as they have to travel through a nancial clearinghouse before you receive funds.fififfIf immediacy of payment is an issue, stick with credit cards. But if you would ratherhave a lower, more consistent rate, choose eChecks.

9WHY YOU SHOULD NEVER WRITE DOWNPAYMENT INFORMATIONA lot of law rms maintain physical records of their clients’ credit card or bank accountinformation. This practice is a huge mistake. Why? The second you maintain thisinformation, you are now in what’s known as “PCI scope.” In other words, if you keepsuch information, you must be PCI compliant, which means protocols, audits, andliability.Rather than keeping physical records of your clients’ payment information, RocketMatter Pay users can take advantage of the secure integration with the ‘Card on File’feature. This allows you to safely store your client’s credit card information usingtokenization. This method of storing payment information aids in PCI compliance andensures that your clients’ information remains secure in the event of a data breach.Bottom line: Make sure you are following the directions of your merchant provider. Andif you are keeping physical records of your client’s payment information in your lawrm, start shredding.fifiAccepting Credit Card Payments in Your Law Firm

Accepting Credit Card Payments in Your Law Firm10USING PAYMENT PROCESSING TO POWERRECURRING BILLINGBy Larry Port, CEO of Rocket MatterYou know a way law rms can make a lot more money? They can make sure thatthey can bill for more person-hours than they have. We’re not talking about over-billingor misrepresenting time sheets here; we’re talking about decoupling work from thebillable hour.The billable hour is great, but it has an inherent limit: Your time.fififiOne of the most promising developments for law rm pro tability is subscriptionpricing (also known as recurring billing.) Pair it with payment processing, and collectingpayments couldn’t be easier. Consider this: Say you provide regular counsel or a serviceto a client. The client could be, for example, a business that needs access to legal adviceor an individual who needs estate management. They could pay you a set amount ofmoney per month to handle normal legal interactions.

Accepting Credit Card Payments in Your Law Firm11By way of example, consider Rocket Matter’s legal needs. We engaged two law rmsover the years in separate instances. We paid them around 2500 a month for the littlelegal bits and pieces that came up such as lease reviews and employment needs. If weneeded something substantial, then we would sign a separate engagement letter withthem.This setup was great for me as CEO of Rocket Matter because I didn’t have to worry thatthe clock was always running every time I picked up the phone to ask my attorney aquestion. We had a predictable line item on our P&L (something which makes allbusiness people very happy.) Our law rms loved it because they were charging us a 2500 a month and were probably coming out ahead.Recurring billing is one type of Alternative Fee Arrangement, or AFA. You might nothave a service which demands a 2500 a month payment, but even if you can gureout recurring revenue of 50 or 100, you’re o to a good start.The problem is the overhead: How is a busy law rm going to keep on top of theirrecurring billing and keep track of payments? For lower-priced recurring legal services,it almost doesn’t seem worth it. You need to print invoices, track ledgers, and trackdown payments.That is exactly what inspired Rocket Matter’s Atlas 2.0 recurring billing feature. Wecompletely automate it. You set up a fee, type in your client’s payment information, andyou’re done. It’s “set and forget.” Pair that with payment processing, and your billingwill be a breeze.So how does it work? The rst thing you do is select “recurring billing” from the matter paymentspage. Next, set the amount and billing information for your client. After that, specify if funds should be deposited into trust or an operatingaccount.fifififffififi Finally, take a look at your plan and nalize it.

12PAYMENT PLANSOne of the biggest pain points for law rms is collecting money. On average, small lawrms collect only 71% of what they bill, so a frictionless, e ortless automated billingsystem can dramatically drive up cash collections.A payment plan is one of the best ways to collect revenues. With payment plans,lawyers can set an amount for an invoice and charge clients on a monthly basis untilthe balance is paid o . This is great for situations where clients cannot pay large billsupfront but can pay in increments, which is commonly the case with Immigrationattorneys, Criminal Defense attorneys, or any litigators who generate large bills.fififffifiWith practice management systems such as Rocket Matter, for instance, law rmstypically schedule out the payment plan in a few quick steps. Attorneys simply put theirclient’s credit card or bank account routing information on le, and the balance isautomatically paid gradually over time. In other words, the client is automatically billedon a monthly basis and the payment goes through without your having to do athing. This increases the likelihood that your rm will be paid in full. It also makes theprocess so much easier. Manually doing payment plans, printing invoices, sendingfffiAccepting Credit Card Payments in Your Law Firm

13them, and waiting for checks is very labor intensive. The automated nature of paymentprocessing simply eliminates these barriers.In the following image, the law rm is splitting up a 5,000 payment in 12 equalmonthly payments. Options exist to create the plan with an up-front payment and tospecify the amount of each payment as opposed to the number of payments. The lawrm can also add credit card or eCheck (electronic banking) information on this screen.Once the payment plan is in place, the user sees a con rmation screen to verify thateverything is setup correctly. Rocket Matter automatically divides the 5000 into 12equal payments of 416.fifiOnce the law rm sets this plan up, they need to do nothing else. The system willautomatically bill the client starting on the date shown.fifiAccepting Credit Card Payments in Your Law Firm

Accepting Credit Card Payments in Your Law Firm14THE HIDDEN FEES OF CREDIT CARDPROCESSINGBy Jeff SHavitz, Rocket Matter Pay AdvisorIf you signed up for credit card processing, you’ve probably stared at your statement inbewilderment. “This seems more expensive than I thought it would be,” you mighthave thought to yourself.Our research shows that many lawyers who run boutique law rms of fewer than tenemployees are so busy handling their day-to-day issues that they don’t adequately andproperly address their credit card transactions and corresponding costs. This happensnot only to small law, but also to CFO’s who manage larger legal practices. In my twentyyears in the payments industry and experience dealing with many law rms, I havefound that the legal industry faces the same issues as a retailer or restaurant. After all,business is business.fifiAccepting credit cards—namely Visa, MasterCard, Discover, and American Express—helps a company in many ways. However, it is important to avoid the pitfalls associated

Accepting Credit Card Payments in Your Law Firm15with taking a credit card for payment. Just like we need to maintain our health byexercising regularly, law rms must exercise their nancial acumen when analyzingwhether or not they have the best credit card program for their practice.Yes, the word “program” is critical as there are di erent appropriate programs andsolutions depending on the needs of the rm. “What is your rate?” is the most commonquestion we hear from potential clients; however, the base rate is only part of theequation. The credit card industry has numerous hidden costs which can and willin ate credit card costs. Unfortunately, most lawyers and company administrators areunaware of these additional fees and how they adversely a ect the bottom line.Credit card fees are confusing. Visa, MasterCard, Discover, and American Expressmaintain di erent rate structures depending on the type of card and on how atransaction is processed. The associations that manage the interchange fees (basicallywholesale fees) present rates in di erent forms such as quali ed, mid-quali ed, andnon-quali ed. Credit card companies also have other fees such as batch fees, debitfees, annual fees, voice veri cation fees, and address con rmation fees. I think youunderstand the point: This can get really tricky and confusing!Also, many credit card companies will o er a low introductory rate, which to alayperson will seem too good to believe or at least better than their current deal.However, what will actually be unbelievable will be the “downgrades” or penalties that abusiness will have to pay—often without even realizing it—because there are so manyadditional issues that you have to consider besides a low base rate (the initial rate you’ddiscuss with your credit card company.)The most cost-e cient program is called “Interchange Plus Pricing” which charges thetrue interchange cost and will ensure that your business is receiving the best feestructure. In order to run your rm in a nancially astute manner, you must know your“e ective rate” which takes into consideration all charges vs. your base rate.fifififffifffffififffifififfifffiflffAnother important issue that payment processing companies rarely raise is how longit’ll take until your money is deposited into your bank account. Some take as long as 72hours! However, why should you have to wait three days to get your money? It iscritical to select a processor which provides law clients with “next day funding” on allcard types including American Express.

Accepting Credit Card Payments in Your Law Firm16Other questions you should ask: Is your discount fee taken daily or monthly? Is yourmoney properly deposited into your trust account or your operating account? Mistakesinvolving set-up and deposits into the proper accounts can jeopardize your licenses.Think about the savings on interest and increased cash ow if your fees were removedat the end of each month. It certainly adds up. Addressing the issues I’ve highlightedwill help greatly with your cash management.Also, keep in mind that many rms are now using mobile devices to capture the creditcard payment at the point of sale. Lawyers can visit their customers out of the o ceand literally take the payment on their iPhone or Android; the monies will be in theirbank account the following day.Finally, it is important to note that switching processors is not di cult. In fact, it onlytakes a few minutes. In most cases, there is no fee to switch, and you just have to llout a brief application. Why not start saving money today for your law rm? It is a muchbetter investment to spend your money on improving your rm’s pro tability instead ofwasting money on the high and hidden costs of your credit card processing fees.fiffifififfififlfi*Originally published on the American Bar Association’s Law Technology Today

Accepting Credit Card Payments in Your Law Firm17TRUST ACCOUNTINGOf course, lawyers need to make sure they are compliant with all aspects of paymentprocessing, and when it comes to trust accounting they need to be particularly careful.Lawyers need to understand what the IOLTA rules and regulations are in their statesand then follow suit.For credit card processing, each law rm must have two separate bank accounts thatthe processor can facilitate. So if you’re accepting credit card payment for retainers, themonies need to be properly placed in the trust account, while fees should be deductedfrom the operating account. In other words, if you want to accept a transaction rightaway for a matter that you’ve completed, the transaction should be operated throughthe operating account. These accounts must be separate because of IOLTA rules. Yousimply can’t put money into an account when you haven’t really earned it yet.fiThis is why it’s critical that you choose a payment processor such as Rocket Matter Paythat knows about such compliance rules. They make sure no processing fees will evercome out of your trust account. Here is how it works:

Accepting Credit Card Payments in Your Law Firm18

Accepting Credit Card Payments in Your Law Firm19HOW TO ESTABLISH THE IDEAL BILLING ANDPAYMENTS WORKFLOWIncreasing your collections has a lot to do with how regularly you send out bills, themethod by which you deliver your invoices, and how easily your clients can pay. Gettinga solid billing and payments work ow will ensure that you capture the time you workand that you get paid for it quickly. Use the following work ow as a template to get setup or as a way to tighten up your billing and payment processes at your rm. If you’rejust starting to incorporate payment processing into your business, this should be ahelpful tool that will save you time.Step 1: Set up your invoice templates.fififlfififlfiYour practice management software can greatly help with this. For instance, RocketMatter has six pre-set invoice templates to choose from. If you don’t like those, you canmanipulate them yourself or hire Rocket Matter’s professional services to do it for you.You can personalize the invoice by adding your rm's logo and changing some of thecolors. If your clients want to see speci c line items, you can add those merge elds toyour standard invoice or upload special invoices to apply only to the matters that needthem. This is a helpful feature for rms with multiple practice areas.

Accepting Credit Card Payments in Your Law Firm20Step 2: Enable invoice sharing for your clients.When you add a matter, ask your client for approval to email your invoice rather thansending it snail mail. This is a key element in driving down overhead and administrativecosts. If your client insists on snail mail, of course you can accommodate his or herwishes. The goal, however, is to eliminate this extra step of printing and mailinginvoices each month.Step 3: Set up and apply taxes, surcharges, and convenience fees ifnecessary.In some states, attorney services are subject to state sales tax, use tax, and possiblylocal taxes. The charges can vary based on where the service is received or where thework is performed. Rocket Matter allows you to set up unlimited rules for the statesand local areas where you service your clients. The rules are exible enough that youcan apply taxes to selected fees and expenses or to all of them, and you can set up therules on a matter-by-matter basis. This feature eliminates manual calculations thatused to be necessary at the end of every month. It also helps with end-of-yearreporting and taxes.Step 4: Capture time automatically with Bill-As-You-Work technology.Avoid reconstituting your time at the end of the month by capturing work as youperform it. Rocket Matter allows you to bill from tasks, notes, documents, calendarevents, phone messages, and emails. They also provide multiple timers. The idea is tobill from anywhere without interrupting your work ow because capturing your time asyou work is the easiest way to ensure that you aren't missing time at the end of themonth.Step 5: Schedule a cutoperiod for billing.fiffffflffflfffffiThe most well-run law rms bill at the same time every 30 days, usually in the rstweek of the month. When you’re ready to bill, you need to identify a cuto date. Thatdoesn't mean you and your sta stop adding time for continuing work. Instead, youshould enter anything that you need to bill prior to the cuto date. It's also helpful toset a recurring calendar event in your practice management system for the cuto .

Accepting Credit Card Payments in Your Law Firm21Step 6: Set up your automated payment emails.Rocket Matter allows you to fully customize the text of automated emails you send withthe generated invoice and link to secure online payment. Take a look at the defaultemail and modify it to your rm's liking. Remember, this communication is a re ectionof your rm and needs to inspire your client to take action, so it is an important detailto remember.Step 7: Run your pre-bills.Pre-bills allow you to see a preview of your invoices so that you can check forformatting, errors, or omissions. The nice thing about Rocket Matter pre-bills overother software packages is that the pre-bills are high delity. They accurately depict thebalances of your matters as if the pre-bill were an actual invoice. No debits are createdon your matter ledgers when a pre-bill is run. You can run a pre-bill for a single matter,a single client, or for all your open matters through batch billing capability.Step 8: Run batch billing.Batch billing allows you to generate all of your invoices at once, and if you’ve enabledinvoice-sharing for your clients, they will receive your customized email with theirinvoice attached. In other words, with a couple of clicks, all of your invoices aregenerated and emailed out. What’s better than that? If you compare this to the oldschool practice of generating invoices one at a time, then folding them, addressing theenvelope, stu ng the envelope, stamping, and sending, batch billing saves a lot of timeand money.You can also see when your clients have viewed their invoice. With Rocket Matter, yourledgers will be automatically updated when your clients pay. If any clients areuncomfortable paying online, you can apply payment to their invoices with a credit cardover the phone by using a payment processor such as Rocke

their tables. And by not accepting credit cards or eCheck payments, they're missing out: A recent survey by Intuit found that 83% of small businesses that accepted credit cards saw increased sales. Fifty-two percent of those surveyed made at least 1,000 more per month and 18% made at least 20,000 more per month.