|
by Douglas Schoenberg
Collecting and processing payments — your
camp's financial health depends on it!
It can also be a time-consuming and burdensome
administrative task. Fortunately, it's
an area where the smart use of technology can
provide dramatic benefits.
Effective Accounts
Receivable and Billing Systems
The first important
technology for managing and collecting fees is
an effective and efficient accounts receivable
system. Today, most camps use some sort of computerized
accounting system but still struggle to manage
payments with a spreadsheet or general-purpose
database. Such general-purpose programs often
lack critical features for camps such as the
ability to:
- Maintain a complete payment
history.
- Produce simple invoices that
can be printed or e-mailed.
- Generate aging
reports of who owes money and for how long.
- Automatically
calculate and post standard fees.
- Quickly
post payments and produce bank deposit slips.
- Audit
when and by whom transactions were posted.
- Track
canteen deposits and charges separately from
other charges and payments.
Even with a good
accounting system, fee collection can be time-consuming,
but offering parents the ability to pay electronically
can dramatically reduce the workload.
Electronic
Payments
Offering electronic payments makes sense
for most camps, because you can collect payments
more quickly and with less effort. Parents love
the convenience as well as perks, such as airline
mileage, that credit cards provide. Electronic
payments can encompass not only credit and debit
card payments, but also payments by direct bank
account debit via the Electronic Funds Transfer
(EFT) network.
Electronic payments can be pre-authorized
to be made automatically when due, or parents
have the option to initiate each payment. Parent-initiated
transactions can be processed by your staff or
directly by parents online.
Pre-authorized Versus
Parent-Initiated, One-Time Payments
Pre-authorization
indicates that parents agree to have their payments
made automatically when due, thereby reducing
the work for both parents and camp administrators.
To manage pre-authorized payments most effectively,
you will need software that provides for the
following features:
- Securely encrypts
and stores credit card or bank account data.
- Automatically
generates and sends for processing transactions
when due.
- Allows for amounts that can
vary, based on balance and payment plan selected.
- Handles
both credit cards and EFT transactions.
- Integrates
with your accounts receivable system.
While pre-authorized
payments are the best way to ensure timely collections,
electronic payments also make parent-initiated
payments more convenient.
Online Versus Staff-Processed
Transactions
Collecting the Correct Payment Amount
The
simplest approach is to use a physical or electronic
invoice to communicate the charges and amount
due. Some systems even provide a “pay online” link
within electronic invoices to take parents to
a pre-filled online payment form.
For staff-processed
transactions, integration with your accounts
receivable system makes it easy to ensure the
payments are processed for the full balance due.
Reducing the Risk of Human Error
Real-time authorization
where the card number, expiration date, and available
funds are validated immediately is critical for
online or staff-processed transactions. This
way, any data entry error or need for a different
credit card can be identified and corrected immediately.
Of
course, the best solution is eliminating the
need to enter the credit card data each time.
Since parents usually use the same credit card
or bank account, the solutions that allow saving
the account information so it doesn't need
to be entered each time, achieve this. The challenge
is doing this in a way that is secure and protects
this sensitive data.
Ensuring Data Security
The
credit card industry continues to impose tighter
rules on the handling and storage of credit card
data. In brief, any credit card data that is
to be stored must be secured. In computer terms,
this means both password protected and encrypted,
with similar protection of paper records that
include credit card information. Any online payments
have to be processed on secure Web-servers (note:
you can tell if the site is secure by seeing
if the Web address starts with “https:”,
not just “http:”).
Keeping a list
of parents' cards to process or using e-mail
to receive credit card data are bad practices
that put parents' information at risk and
expose your camp to fines.
Maximizing Administrative
Efficiency
To eliminate the need for any double
entry of payments, you'll want processing
solutions that post the payment automatically
to the parents' ledger in your accounting
system. Non-integrated solutions not only mean
more work, but also increase the potential of
human error.
Here are a few other features to
look for to simplify payment administration:
- Payment
receipting via printed or e-mailed receipt
- Ability
to review completed (as well as non-completed)
payment transactions
- Ability to issue
any necessary credits/refunds
- Online
tools for reporting and analysis of transactions
Pitfalls
to Avoid
Credit Card Terminals
Physical credit
card terminals were designed for face-to-face
retail transactions and are ill-suited for processing
camp payments because:
- They require keying
of card data, which is time-consuming and error-prone;
- They
don't provide a method to securely store
card data for future transactions;
- They
require separately keying payment data into
your accounting system – this also creates the
need to reconcile amounts between systems; and
- They
don't provide e-check (EFT) processing.
Stand-Alone Processing
Solutions
Many of the
benefits of electronic payments diminish if you
use payment-processing solutions that do not
integrate with your accounting software. Typically,
they require you to:
- Enter and maintain
the same contact information in two places;
- Don't
ensure that amounts paid match balance due;
and
- Reconcile transactions between multiple
systems.
Non-Secure & PCI
Compliant Systems
If payment account data is stored on your computer,
it is critical that it be encrypted to protect
it from unauthorized access. An even better
method is for account data to be stored on
a PCI compliant server maintained by your processing
service, with a solution that allows you or
your parents to initiate charges to the stored
account without needing to re-enter the data.
Hopefully, you now have a better understanding
of how convenient and efficient processing
of electronic payments can truly be for both
parents and camp.
Originally published
in the 2008 November/December issue of Camping
Magazine.
|
