The problem
Many private family clients can't pay a large bill at once, so the firm agrees monthly installments and then chases them by email and phone. If 20 clients are on plans and chasing each payment takes 15 minutes a month, that's 300 minutes, 5 hours a month, before any payment that never arrives.
What the AI does
GoCardless collects one-off or recurring payments by Direct Debit from the client's bank account. Once a client agrees an installment plan for a bill already delivered, they set up a Direct Debit through GoCardless and the agreed amount is collected each month. Staff check collections instead of chasing them. This is for fees already billed, which are office money; money on account for future work is client money and must go to your client account under the SRA Accounts Rules.
A worked example
A family law firm in Bournemouth has about 20 private clients paying billed fees at $333£250€298A$480C$470 a month. It moves them to GoCardless Direct Debits, and the cashier checks collections and failed payments once a week.
Before
15 minutes a month chasing each of 20 installments: 5 hours
After
About 3 minutes a month per client checking collections: 1 hour
What it's worth
About $160£120€143A$230C$226 a month of staff time, if it is worth $40£30€36A$58C$56 an hour: 12 minutes saved on each of 20 clients is 240 minutes, 4 hours. GoCardless Standard charges 1% + 20p a payment, excluding VAT, so $3.59£2.70€3.21A$5.18C$5.08 on each $333£250€298A$480C$470 installment and $72£54€64A$104C$102 a month for 20. Fewer missed payments are not counted.
How to set it up
- Ask your COFA to confirm which money can be collected this way, and into which account, under the SRA Accounts Rules.
- Agree each installment plan in writing with the client, including what happens if a payment fails.
- Set up GoCardless and send each client a request to set up the Direct Debit for the agreed amount and date.
- Check collections and failed payments weekly, and contact the client the same week if one fails.
- Stop the plan as soon as the bill is paid.
What goes wrong
- Money for future costs is client money. Collecting it into your office account breaches the SRA Accounts Rules, so check with your COFA first.
- Clients can cancel a Direct Debit at any time. A failed payment needs a quick, kind follow-up, not an automated threat.
- Fees are per payment and exclude VAT, and Direct Debits over $2,660£2,000€2,380A$3,840C$3,760 cost an extra 0.3%.
- Some clients' bank statements are seen by the other party. Check the client is comfortable with the payment appearing there.