As digital banking and other online commerce continue to expand, the trend toward accepting rent payments online is becoming an increasingly attractive both for tenants and landlords. When done correctly, accepting rent payments online provides solid tracking of accounts and allows renters to pay any time, eliminating many common excuses for late payments.
Accepting rent payments online saves time and effort landlords as well as tenants. From the tenant’s point of view, having the option to pay anytime removes one more task from their to-do list while they travel around town. Landlords and property managers enjoy the fact that accepting rent payments online allows them to track accounts quickly and accurately. This translates into better fewer late or delinquent accounts and better cash flow overall.
At the same time, accepting rent payments online is not automatic. Creating a smooth transition to this new system requires proper planning and implementation. In order to increase the likelihood of instituting a smooth transition, landlords should pay attention to the following issues that may arise:
First, landlords should make sure they understand the computer literacy of their tenant population. Tech-savvy tenants may actually prefer living in a complex that is committed to accepting rent payments online. Other types of renters, may shy away from this option unless they receive thorough education beforehand.
Second, even the best system for accepting rent payments online needs a back-up. Landlords should avoid relying exclusively on an online system. For one thing, maintaining alternative payment options provides a comfortable alternative for people who still wish to pay rent in more traditional ways. For another, technology is notorious going offline. Having a hard-copy back-up payments plan will almost certainly be worth its weight in gold one day, should the online system crash.
Third, when instituting a system for accepting rent payments online, landlords should clarify who will pay for transaction fees from the outset. Most banks include transaction fees in exchange for transferring online payments to bank accounts. There are two options to deal with this challenge. Landlords can foot the bill themselves, or they can include the charge in the rental fees from the beginning of the agreement. The key here is to make sure tenants are not required to make a separate payment for this fee. That could spell havoc.
Fourth, creating a system for accepting rent payment online requires patience on the part of the landlord. Most banks take a few days to process online payments. Also, many holidays as well as weekends interrupt the processing time.
Fifth, any system created as a means of accepting rent payments online must be secure. One hacking incident can destroy the whole experiment. Hackers will not stop if they believe they can eventually strike gold. The move to an online rent collection system must clear this hurdle in order to avoid endless legal battles down the road.
Finally, accepting rent payments online means creating a website, and creating a website means there will be website issues. Landlords must realize that as efficient as any system is, they will still be called up to deal with technical support. In addition, they will also need to provide answers to tenants on how to use the website correctly.