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Digital Banking

The age-old problem of late payments from clients is one that SMEs are all too familiar with. How often do you find yourselves chasing clients, or finding ways to free up cash flow to fund your business operation. The problem is further compounded by the ill effects of the global pandemic on our economy.

 

To help cope with the situation, here are a few tips to get your clients to pay on time and keep your business running smoothly.

Reward early payment and state your terms for late payment

You want to encourage your clients to pay early and avoid late payment. If it’s possible for you and your business, you might want to consider offering a small discount for early or upfront payment. With just a small incentive, you may even be able to get your client to agree to an advance payment or a retainer.

 

Make sure your contract covers your payment terms. To discourage late payment, you can state penalties for late payment and non-payment, such as late fees or even interest charges for late payment. You’ll may also want to set down terms for project termination. Times are uncertain, and if your clients cancel requests or change plans, you want to make sure you’re covered.

Go electronic and automatic

With many of us still working from home, now’s the best time to start going digital – and going digital can help make sure you’re paid on time. If your clients give recurring payments, you can try to push for automated payments. Not only would this ensure you get paid on time, but you’ll also save time on sending reminders and following up on overdue payments.

 

Even if your client does not agree to automated payments, you can still automate your reminders and send your invoices electronically. This will help make sure your clients receive your reminders and invoices on time, especially now that post services are busier.

 

One affordable way to go digital is with our partner for SMEs, Billplz. Billplz is a payment platform service that lets you take orders and get paid instantly through a unique link you can share with your clients. You can sell online via social media or on chat platforms, and you don’t have to share any personal banking details, so it’s easy to start going digital with Billplz.

 

As a CIMB customer, you can even save up RM 100 worth of FPX Transactions with Billplz. Sign up here: https://www.billplz.com/partner/cimb

Communicate clearly and often

Aside from regular reminders and invoices, be sure to talk to your clients about any payment difficulties either of you might have, so you can try to work things out together. Although you shouldn’t ignore late payments, it’s important to maintain a good relationship with your clients. Times are difficult now, but you can still have a good partnership once things get better.

 

Although there are a few ways to get your clients to pay on time, it’s not always possible for them to do so. To put your business first, you can try to prioritise work for clients who you know will pay on time.

 

This article is brought to you by CIMB as part of our ongoing efforts to raise the level of financial literacy among Malaysians. Financial knowledge and understanding are key to making well-informed and meaningful financial decisions that will improve our well-being. This, in turn, achieves CIMB’s purpose of advancing customers and society.