The Evolution of Payments

Rusty Hruby
By Rusty Hruby

Have you heard of any of these?

PayPal

Apple Pay

Google Wallet

Venmo

Bitcoin

Payment options are changing rapidly!

Paper checks are the traditional payment method. They’re still the comfortable choice for the 65+ demographic and many believe, “if it ain’t broke … don’t fix it”. But when it’s certainly not the most member-friendly option. Members are required to mail or drop off their payment, and the accounting team is required to “process” via data entry and bank deposit.

In a world of swipe-tap-or-scan you have to question whether this is the most efficient form of payment.

In the evolution of payments, we are seeing clubs evolve beyond paper checks to include ACH payments. However, when we’ve spoken with clubs, “Auto-Pay” ACH Payments can involve a clunky sign-up process including long forms and a copy of a voided paper check. The accounting staff must then setup the member account with applicable banking information and the monthly auto-pay process requires multiple steps like printing an auto-pay report, keying in balances via the banks website and process, and posting payments in the billing software.

Online ACH Payments, or ACH Credits, have traditionally required a 3rd party payment partner.  This system allows the member to initiate the monthly ACH payment and push funds to the club. When coupled with online member statements, the adoption rate among members is much higher. Of course you need to remember not to send emails with PDFs, instead send an email with a statement notification including a link to the online statement. It’s also imperative that you require only one login for members to view statements and make payments. Online payments should then automatically display in the billing system as a payment batch.

But as we can see, the speed of change in payment options and preferences is rapid. Like, credit cards …..

 

Holy $@#!...did he just say “CREDIT CARDS?” Whether we’re talking about Card Present (Point of Sale) vs Card Not Present (online) credit card payments have traditionally required a 3rd party payment partner. Clubs have largely avoided this payment option due to processing costs and tradition. Some clubs have allowed CC payments with a “convenience” or “program fee”… which is not lawful in all states. And some 3rd Party options allow you to pass along a fee to the member.

And then there’s Bitcoin…just kidding (at least for now). And I say “for now”, because the payment preferences of your members are going to continue to evolve just like the payment tools. Clubs must begin to partner with companies, like Clubessential, that offer payments acceptance and processing as part of the overall package of services. This eliminates the need for 3rd party payment processors. It also allows for a one-stop shop, resulting in better experience - faster funding, which improves cash flow - consolidated reporting -  and simplified reconciliation.