In this concise video, the presenter advises law firms on whether to add credit‑card payment options for client billing. He explains that traditional paper checks expose firms to fraud, require sharing routing/account numbers, and involve time‑consuming manual processing, which hurts cash flow. Accepting credit cards improves client experience, speeds up accounts‑receivable, and offers clients flexible payment options—especially important in practice areas like family, criminal, and collections law. The speaker notes that some states allow firms to pass the card‑processing fee back to clients, but doing so may appear “cheapening” the service. He then outlines two main approaches: (1) using software that separates retainer deposits (to trust/IOLTA accounts) from operating‑account fees, and (2) selecting a payment processor that integrates with the firm’s practice‑management system. Recommended solutions include Confido (formerly Gravity Legal) for its trust‑account compliance and payment‑plan features, LawPay (often paired with MyCase), and Clio Pay for firms using Clio. He discusses processing times (next‑business‑day for cards, slightly longer for e‑checks) and the importance of configuring processors to automatically record payments in the practice‑management software to avoid manual bookkeeping. He warns against using Intuit Merchant Services with trust accounts, as this violates compliance rules. The video concludes with a call for questions and a reminder to follow best practices when implementing credit‑card payments in a law firm.
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This week I'd like to do just a short video to talk about whether or not you should add the ability to pay by credit card to the way your clients can pay you at your law firm. It's a conversation I have with a lot of our clients, and some clients are just proactive. They accept credit card, e-check, whatever, because today's world, you really don't want to be living in the world of checks. Uh, checks The payment by check obviously opens the door for maybe fraud. You have to expose— if somebody wants to wire you money in, you have to expose your routing number and account number. And today you shouldn't be doing that at all. If you are doing that, get a wire account, something that sweeps into your operating or your trust account so you're not really showing those numbers out to the world. It's just a best practice when it comes to that. We try to get our attorneys to get out of that practice of getting a handwritten check or a check by mail. And I think sometimes it's lost in the fact that the time it takes for someone in your office to open the mail, process the check, record the payment, maybe take it to the bank. We still see a lot of clients that they take it to the bank. They're not using software or an app or, you know, their phone app or just that machine that will process the checks. It— there's a lot of time involved in all of that. So when you're looking at cost, you have to factor that into the cost of doing business. A lot of times, many of the firms, they don't want to accept credit cards because they don't want to absorb the fees. In some states, you can actually charge that fee back to your client. But I always sit back and say it kind of cheapens the whole process. Lawyers already get a bad rap for— you've got this long line item bill that we give to our clients that says, okay, time to lick the stamp, 10 minutes or whatever on the bill, or 1/10 of a minute. And sometimes it kind of can frustrate the client and the client experience. So this is all about improving that client experience. But in the, in the long run, it will improve your cash flow, and it will improve your accounts receivable. Any open accounts receivable, people tend to pay faster with a credit card. It doesn't sting as much when you pay with a credit card. It gives that ability for the client to pay over time. So they may not have the cash on hand to pay the lawyer. Maybe they need the lawyer, especially family law, criminal law, collections law. You really need to have that ability to pay by credit card. Now there's 2 ways of doing that. If your state allows you to recoup the fee, you can actually recoup the fee, and there's programs and software out there to do it the right way. So if you're collecting a retainer that the person's paying you by credit card, you want to make sure that that retainer money goes into the trust or the IOLTA bank account, but the fees come out of the operating account. Our favorite software for that is Gravity Legal, which is now called Confido. That one definitely is number one in our hearts for using— having that ability to pay over time, to make payments. We love it for the immigration firm for that. You can you know, set up payment plans and payment methods, but also the ability to pay and have the money land in the right bank account and the fee taken out of operating. So you always stay in compliance. Another firm that does that is LawPay, and that's been around for a long time. You've probably heard of that one. That one owns the software MyCase. So when you're looking at it, know that if you're working with MyCase, you should use LawPay, which lands me down the road to Clio. If you are using Clio software, number one legal software, number one legal practice management software in the United States at least, you want to be sure that you use Clio Pay. Clio Pay is going to make it less work for you. Now on that note, when you do get Clio Pay, know that if somebody pays by credit card, generally you get the money in the next business day. If they pay by e-check, it's a little bit longer, but it's not too bad. LawPay seems like forever for you to get that money, but Sometimes it requires you— if they're paying by the payment link, the payment will be recorded in Clio, so you don't have to record the payment. Obviously, if they're paying— if a client pays you by snail mail check, you're gonna have to record the payment. This is where it gets very confusing for the law firm staff. You're looking at how did the payment come in and whether or not you have to put the payment into Clio, or if it's gonna be auto-generated into Clio. If you have Clio out of the box Clio Pay, you go for it. They have the line item method that they take the fee out with each transaction. It is going to require you to go in that extra step and then record the difference of what they paid and what you received. And it's a lot more work. It's a lot more manual labor on the side of your accounting firm, your bookkeeper, legal admin, whoever's doing this work. It's a lot more to actually open up each payment and record that. It's not auto-generated. If you make an arrangement with Clio that they take the payment once a month for all the prior month fees, so each payment comes in in full, and then at the end of the month they take out the entire fee amount for all of the different transactions, that is going to save you a world of hurt. But you do have to go through the extra action of asking for that. So know that that's a factor. If you are interested in learning about this, each one of these payment processors do have a link to tell you whether or not your state allows for that. So you can click on like Confido and find out what your state allows for being able to get that— those funds paid back to you. And they have that built into their system. Uh, the— just be careful if you do use Intuit Merchant Services. Maybe you're an AR company and you only live in the world of AR, you don't live in the world of trust accounting. You can use Intuit Merchant Services. It is great. It does work seamlessly behind the scenes. However, do not connect it to your trust account. If you do, they will figure it out eventually, and they will shut you off and shut you down. So don't even try to do that. That's not compliant. It's not allowed. So you can't really do that. And I've seen some people try to do that. It doesn't work. So know that that's a factor as well. I think that's about it for my tips on best practices when using credit cards at a law firm. If you have any questions or comments, feel free to reach out. And until next month, we'll see you then. Bye now.
