It’s not uncommon for many childcare businesses to accept only checks and cash. With so many childcare-specific problems to solve on a daily basis, it’s incredibly easy to procrastinate on the bigger picture items. While some centers have progressed a bit and might have a credit card reader in their center, which is a great step toward convenience for the parents, that may not help the director much at all. Additionally, as the millennial generation becomes the majority of the “parent” demographic, they expect to pay for childcare as they do everything else: on their phone.
Having payment system that is integrated into your family data means that you spend less time doing administrative work and spend more time with your teachers and students.
It’s truly a win-win for everyone. It may seem overwhelming to analyze your options, decide on a solution and switch all of your existing families to a new process. Change can be difficult, especially when you have tens or hundreds of parents to get on board.
In this guide you’ll learn why in this day and age, electronic payments are not just a feature that’s nice to offer, but a must-have. Then, we will dig into how to find the best solution for you and how to implement the change for existing and new parents.
Why should I accept electronic payments?
As a childcare director or owner, you and your childcare team spend a lot of time doing a variety of things in your center. We’ve found that the largest amount of time is usually spent staying on top of billing parents and accepting payments. Your business has to accept payment to run, so this is a top priority out of necessity.
There are childcare management solutions out there that allow parents to pay via a mobile app, update their payment method, view their bill and access their statement history. This amounts to hours each week that you can spend elsewhere, growing your business and making it run efficiently, instead of focusing on these day-to-day tasks that can weigh you down.
Eliminating a human hand from the mix means that you’ll be reducing the risk for human error.
Let’s face it: everyone makes mistakes and each mistake is time (and potentially money) directly out of your pocket.
Using a system that can generate a recurring invoice each period, automatically charge the parent’s card or bank account, and adjust the balance accordingly, means less math for you.
A great system should also allow you to credit or adjust bills as needed or even split bills between divorced parents or automatically adjust a bill for a child who receives a state subsidy. All you should need to do is run reports to check or view data when you need to see it; not spend hours daily checking your own work.
Parents Expect It
Millennials are now the main demographic having children and searching for childcare. This group has had technology for their entire adult life and spends hours each day on their mobile phone. According to Pew Research Center, 93% of Millennials own a smart phone. Gen Z, the generation behind them is the first generation who has grown up with social media.
These groups are used to convenience. Everything from groceries to furniture is purchased with the click of a button. Your business is no exception. If you don’t accept mobile payments, but your competition does, as long as the quality of your services is deemed equivalent, they will win that match up. Meet parents needs by adopting the technology and beat their expectations with amazing service and education for their children (which you’ll be able to focus on now, with all the time you’re saving!)
How do I start accepting electronic payments?
Find a Solution
There are quite a few software solutions out there to help you manage your center. Of course, at Smartcare, we are a bit bias about our technology, but you should find the one that meets your needs. All of the options out there should offer you a demo to begin.
A software demo is your chance to scrutinize the solution being offered to make sure it does what you need.
Make sure you ask the right questions during your demo, depending on your needs. Here are some ideas, based on needs we hear:
- Does the technology support your billing frequency? (weekly, monthly, biweekly)
- Does it accept both credit cards and ACH? Do you have to accept both if you don’t want to?
- Can parents manage their own payment methods?
- Can parents access their invoices on their own?
- Can parents enroll in autopay?
- Can you set up automatic late fees or other fees?
- How long will it take you to get set up?
- Are you under a contract?
- Do they offer a free trial?
- If you need to charge any fees, accept deposits, etc. make sure the software has a solution for that
If you center has any unique situations, make sure to walk through it with your sales consultant. You don’t want to purchase technology that doesn’t solve your problem or makes more work for you.
Email Existing Parents
Once you’ve set up your new software, start by moving existing parents over to the new process. Depending on the size of your center, you might start with a small group (like a class or two) and keep going from there.
Email is a nice way to communicate this change to your parents for a couple of reasons. First, you can outline the benefits of the new solution for them:
- Access your invoices
- Manage your own payment method
- View your bill
- Enroll in autopay
Secondly, you can also link to the app that they need to download. As most parents will be reading your email on a mobile device, this allows them to click through and download the app right from their phone.
Starting with your existing parents (and potentially a small group of them), is a perfect way to introduce this change as they will be more forgiving as you learn the new software than brand-new parents, who haven’t yet made a judgement call on your business.
Keep in mind that any new software will have a learning curve, so while it might be tempting to rip the Band-Aid off and move everyone at once, a tiered approach like this will allow you to make sure you’ve selected the right technology and work out any kinks until you’re running smoothly.
Enroll New Parents
Focusing on new parents should be your second goal, after you’ve gotten most existing parents using your new software. Here’s where we are going to be just a little self-indulgent. Smartcare offers an online enrollment tool that makes this process incredibly easy. Send a link to parents and they can:
- Enter all of their child’s information
- Add pick up and emergency contacts
- Add medical information and allergies
- Enter a payment method
- Pay any deposits needed
- Enroll in autopay
This means from the minute a parent knows they want to enroll; their billing is set up with zero effort on your part.
Making sure that you have a seamless solution for newly enrolled parents means that you aren’t just saving time with the daily billing and payment tasks, but also on the enrollment end as well.
Now that you’ve got most parents set up and have a process to capture payment method during enrollment, you should optimize the software you chose and make sure you are getting the most payments at the earliest time possible.
By promoting an autopay feature you will receive parent’s payments on time and have happier parents because the process is easy and will result in less risk for late fees on their end.
We’ve seen centers get creative here. Maybe you simply send out an email blast occasionally, reminding parents to enroll in autopay, or maybe you offer incentives for enrolling. For example, you might give a small discount to parents to are enrolled in autopay, or maybe the reverse works better: if not enrolled in autopay by a specific date, then there will be a small price increase.
Parents will understand that if they don’t enroll in autopay, that means more work for you so typically, this approach makes sense and makes everyone happy.
Adopting the plan above is a surefire way to implement electronic payments for your center and make sure you find a great program to work with. If you aren’t already accepting electronic payments or using a childcare management software, hopefully this guide has helped you determine what to look for and understand how to make the change. It might seem like a big adjustment, but once you’ve made the jump you and your families will be grateful for the change.
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