The problem
Fees paid by bank transfer arrive late or not at all, and chasing parents eats evenings. With 140 families paying $140£105€125A$202C$197 a term, if 24 pay late each term and each takes 30 minutes of messages and bank checks, that is 12 hours a term; and if 3 families a term never pay in full, that is $419£315€375A$605C$592 a term lost.
What the AI does
GoCardless is a Direct Debit service. Its pricing page says the Standard plan collects one-off, subscription, membership and installment payments, with pre-built payment pages, at 1% + 20p per UK transaction, capped at $5£4€5A$8C$8 with no setup costs; VAT is charged on the fees. Send each family a GoCardless payment page to set up a Direct Debit, then collect each term's fee on a set date. The parent is the payer, so use a family reference rather than the child's name. GoCardless handles the collection, and you follow up any payment that fails. Standard doesn't include automatic recovery of failed payments, which is on Advanced and Pro.
A worked example
A dance school in Leeds has 140 families paying $140£105€125A$202C$197 a term for three terms a year, mostly by bank transfer. Over the summer the owner moves every family onto a termly GoCardless Direct Debit, collected on the first day of term.
Before
About 24 late payers a term, 12 hours of chasing and 3 families a term never paying in full
After
Fees collected on the first day of term; about 4 failed payments a term to follow up, 2 hours of chasing
What it's worth
About $146£110€131A$211C$207 a month, against about $70£53€63A$102C$100 in GoCardless fees. That is 30 hours a year of chasing saved (10 hours a term) at an assumed $33£25€30A$48C$47 an hour, $83.13£62.50€74.38A$120C$117.50 a month, plus $63£47€56A$90C$88 a month in profit at an assumed 90% margin on $838£630€750A$1,210C$1,184 a year of fees from 2 families a term who now pay. Fees: 420 payments a year at $1.66£1.25€1.49A$2.40C$2.35 each plus VAT is $838£630€750A$1,210C$1,184 a year, $69.83£52.50€62.47A$100.80C$98.70 a month.
How to set it up
- Sign up for GoCardless Standard and set up a termly payment plan for each fee level.
- Send each family the payment page link with a short note on the amount, the collection date and how to cancel.
- Use a family reference, not the child's name, for each Direct Debit.
- Update your terms and conditions to say how fees are collected and what happens if a payment fails.
- Check failed payments after each collection date and contact those families yourself.
What goes wrong
- Standard doesn't retry failed payments automatically; that needs Advanced (1.25% + 20p, capped at $7£5€6A$10C$9).
- Some parents won't set up a Direct Debit. Keep a simple bank transfer route for them and chase those few by hand.
- VAT is charged on GoCardless fees whether or not your school is VAT registered, so include it in your costs.
- Changing the amount mid-year, for a sibling discount or a second class, means updating the plan for that family; check it before each term.