We attorneys tend to be late adopters to technology. This includes the technology involved with taking credit cards. A lot of attorneys are still just beginning to set up the process right now. In fact, the Pennsylvania Bar Association (of which I am a member) recently joined with LawPay to help attorneys with the ability to accept cards. This suggests that taking cards is becoming more mainstream for lawyers and law firms.
Why Attorneys Don’t Take Credit Cards
Understand, there is a reason attorneys are slow to adopt new technology, namely, ethics. There are all sorts of issues related to how we are required to handle money that have a major impact on what banks, credit card companies, and credit card processing companies that we can use with comfort.
Another issue, of course, comes down to fees. If you hire me to assist you and I end up with a fee amounting to several thousand dollars, you can see why I might not want to give up a percentage of that to a credit card company. Those fees can add up quite quickly. If I brought in 100k last year, and had to pay 3.5 percent out to a credit card company, well, I am out $3500.
Last, it comes down to how much the lawyer actually accepts credit cards against obtaining the ability to accept those cards. Perhaps the lawyer doesn’t have many clients who ask to pay by card. Credit card companies, in addition to charging a percentage of the transaction, also charge a monthly fee. In addition, being approved to accept credit cards can be a bit of a pain in the you know what. There are numerous forms to complete, and if you want to accept cards online, it gets even more complicated (and expensive.) So maybe some lawyers just think, this doesn’t really impact me, I don’t need to bother jumping through those hoops.
Why Attorneys Should Take Credit Cards
All of the above said, sometimes it just makes sense to take credit cards from your clients.
Since attorney’s fees can be expensive, unless you want to allow a payment plan, a lot of clients will simply need to pay by card.
Second, it comes down to receivables. Would you rather have to chase the money later, or would you rather have the money now (even with the deduction of a few percentage points.)
Third, it comes down to convenience. People like to pay with credit cards.
Fourth it comes down to speed. Some attorneys (including myself) do most of their work over the phone or the Internet. For example. Let’s say I have a new client who wants me to get started right away. And let’s also say I require a retainer to begin the work. The client can’t just hand me a check, because we have never met. He also wants me to get started right away. There are two ways to go here.
The client can:
- Write a check
- Mail me the check
- Wait for me to get the check
- Wait for me to deposit the check
- Wait for the check to clear
- I start working
The client can:
- Give me a credit card number
- I charge the credit card
- I start working
Obviously, if a client wants me to start work on his issue right away, he is going to want to pay by credit card. It can easily take a week or two for me to get a check and have it clear. Processing a credit card takes moments.
Actually Taking Cards
If you are interested in taking cards, but aren’t sure that it is worth going forming a relationship with a credit card processor, consider using Square. Square does not charge a monthly fee, and it charges a consistent percentage to swipe a card, or, if you don’t have the physical card, a slightly larger percentage to enter the number by hand. This is a frequent question about Square. So to be clear, you don’t actually have to have the physical card to use Square.
Square does have some limitations, especially when you first get started, in terms of how much money you can accept. But if you are just starting out, this probably won’t be an issue for you. If you decide you want to take Square, you can get the adapter for your phone (so you can swipe cards) for free. I have seen the adapter on sale in stores as well. But why pay for it?
If you find that taking credit cards is very helpful, you might then consider going to LawPay or another company so you have a regular credit card processor. Also, if, like me, you use Clio for your law practice management, you can actually connect your credit card processor to Clio, create accounts for your clients, and let them log in and pay. There are numerous similar systems out there.
For most lawyers, taking credit cards is a very good idea. Anything you can do to make it easier for your clients to pay will result in a decreased amount of bad receivables.
And incidentally, I use Square for my credit card processing. Mainly because I don’t end up taking cards all that often. If I find that changes, then I will switch to a credit card processor. Probably LawPay.