One of the top axioms of sales is that the vendor of goods and services must make it easy to pay for the goods and services purchased. Difficulty in accepting payment will cause the customer to look elsewhere. At a personal level, I cannot tell you how many times I’ve started to buy something and turned away in mid-stream because the payment process was too difficult.
In today’s world of plastic money, there is much to be said for the use of plastic: Ease of payment; creating a paper-trail for tax purposes; and the added ability to challenge the quality of the purchase should something go wrong.
Thus, lawyers should certainly consider accepting credit card payments. They make payment easy for the client, and also make it easier for the lawyer to get paid, a benefit for both parties. Use of the credit card provides convenience for both parties and improved cash flow for you. The few dollars (2% to 4%, depending on your volume, the card and your ability to negotiate with your bank and processing agent) that processing fees cost you to get the money faster is offset by the ease of payment, the assurance of payment and the speed of collection. Payment in this fashion is made after the billing.
If you obtain the credit card information of the client in advance of the billing (for example, at the inception of the engagement) and permission from the client to charge his or her card after you send your bill, you will be paid more quickly. This acts as a negative check-off. With advance permission, the client can change his/her mind only with an affirmative call to you not to use the card, that there is some difficulty the client has with your bill. Of course, any such call requires immediate attention and response to clear up the issue to the satisfaction of the client. Short of full understanding and satisfaction by the client, there will likely be a disciplinary or even malpractice action in t he near future.
A couple of caveats are necessary.
First, client payments by credit card should only be for legal services rendered. They should not be requested or accepted for unearned retainers or charge-backs of unearned fees. To accept payment by credit card for retainers requires special care.
Second, there is a distinction between credit charges that are non-refundable under the terms of a client’s engagement agreement, and the right of the client to dispute the lawyer’s charges through traditional State Bar dispute resolution procedures. Any dispute over fees paid by credit card should be settled between the lawyer and the client, governed by the rules of professional conduct. The credit card company should not be involved. That is why I encourage the lawyer to insert language in the engagement agreement that provides the dispute resolution mechanisms, and reversal of credit card charges is specifically mentioned with the agreement of the client that he/she will deem the credit card payment as non-refundable for purposes of dealing with the credit card provider.