5 ways to get more customers to pay the easy way!

If you’ve been reading the Utility Information Pipeline for any length of time, you know that bank drafts are the easiest way to collect payments.

The challenge is – how do you get more customers to pay by bank draft?

This issue takes a look at several strategies you can employ to get more customers to sign up for bank drafts.

1. It’s as simple as asking

There’s an old adage in sales that goes “if you don’t ask, the answer is always no.” This is as true for signing customers up for bank drafts as it is for any sales situation. Sure, a few people will ask if you offer bank drafts, but you will get a lot more if you ask.

It’s been my experience that utilities with a significantly higher percentage of customers paying by bank draft ask every new customer if they would like to pay by bank draft.

2. Promote, promote, promote

Do you have signs prominently displayed in your collections and customer service areas that promote your bank draft program?

Do you list the various ways customers can pay, including bank drafts, on the back of your utility bill? Do you routinely include a bank draft sign-up form with your bill?

Does your website include instructions about how to sign up for bank drafts? Can your customers download the sign-up form?

All of these are simple ways to promote your bank draft program and encourage more participation.

3. Waive security deposits as an incentive

Admittedly, this is a bit unusual and I’ve only ever heard of one utility offering it. However, by not charging a security deposit to customers who sign up for bank drafts, this utility has an astounding 60% bank draft adoption rate!

Read about it here to see if this makes sense for your utility.

4. Remove first-time late fees as an incentive

How many calls have you taken from customers who have never been late before asking if you can remove the late fee?

As a gracious customer service gesture, why not offer to remove the late fee if they, in turn, agree to sign up for bank drafts? By doing so, they will never be charged another late fee and you have one more bank draft customer.

5. Offer rebates

Another option offered by some utilities is rebates for customers who sign up for bank drafts.

We recently did a presentation to a town that offers a $.50 monthly credit to bank draft customers as an enticement to continue on bank drafts.

Other utilities offer a larger, one-time rebate – often after a twelve month qualifying period – for customers who sign up and remain on bank drafts for the full year.

Are you looking for ways to improve payment processing?

Are you looking for ways your office could process payments more efficiently? If so, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could benefit your utility.

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© 2014 Gary Sanders

Should you stop accepting cash…?

We had a new customer go live last week and, interestingly, they don’t accept cash payments in their office.

This seemed odd at first, but the more I thought about it, the more it made me wonder –would this be a good move for other utilities?

Transitioning to not accepting cash

This customer is not located in a downtown area and, therefore, doesn’t have as many walk-in cash payments as some utility offices. Since they adopted the no cash policy, customers who would otherwise pay in cash are required to purchase a money order.

They experienced a few complaints at first, but otherwise it’s been a smooth transition. Signs in the lobby alert new customers of the no cash policy and a message on their bills reminds customers each month.

Advantages of not accepting cash

Not accepting cash eliminates the possibility of cash overages and shortages and saves time that would otherwise be required to count and balance a cash drawer each day.

This utility deposits checks using remote deposit capture, so not accepting cash means they have no reason to make a bank deposit. This saves the time involved in preparing the deposit as well as the time and effort of taking it to the bank.

Finally, by not accepting cash, there is no need to store cash on-site overnight, reducing the risk of break-ins.

Reduces risk of stealing

Over the course of my career, I have personal knowledge of a handful of embezzlement cases with municipalities or utilities I have worked with. In each of those cases, a clerk pocketed cash and tried to hide it (most times not very well).

By not accepting cash, any temptation by less-than-honest staff members is eliminated.

Payment options besides cash

Many utilities are trying to find ways to reduce walk-in traffic and not accepting cash payments certainly would help in that endeavor. With options such as bank drafts, online bill pay and IVR phone payments, your customers have options besides paying with cash, but they do all require a bank account or credit card.

Are you looking for ways to improve your office operation?

Are you looking for ways your office could operate more efficiently? If so, please give me a call at 919-232-2320 or e-mail me at gsanders@logicssolutions.com to learn how a business review could benefit your utility.

Click here to subscribe to my free e-mail newsletter...

© 2014 Gary Sanders