Things to consider when setting up payments with your financial institution

The payments landscape within Australia is changing rapidly. Non-cash payments, such as bank transfers and direct debit, now account for over 70% of all transactions. Consumers, driven by security, convenience and reliability, are making electronic payments the norm for everything from childcare and utilities to rent and streaming services.

Both customers and businesses can benefit from electronic payments. But bank transfers and direct debits have some crucial differences that you, and your landlords and tenants, should be aware of.

 

Bank transfer

Bank transfers are generally used by consumers to make fast, one-off or recurring payments from their own bank accounts into someone else’s. Consumers make these payments through their bank and can alter the frequency and amount of these payments at any time.

 

Direct debit

Direct debits are similar to bank transfers in that they are also used to make regular, ongoing payments. Unlike bank transfers, direct debits are set up between the customer and the business. This gives the business more control, as customers are not as easily able to hold, reduce or cancel payments.

 

Tips for tenants

While tenants may be attracted by the additional level of control afforded by bank transfers when it’s time to pay rent, this also means extra responsibilities.

 

No money-back guarantees

If tenants enter incorrect account details, or if the account they pay into changes, there’s no guarantee they’ll be refunded for any erroneous transfers. Similarly, if a tenant switches banks, they’ll also have to remember to set up new transfers or risk missing payments. Even worse, tenants who don’t realise their mistake can end up getting hit with dishonour fees as well.

Because tenants control how much and how often payments are transferred, they also have to keep on top of any variable payment schedules or amounts. For example, if utility costs change month-to-month, the onus is on them to ensure correct payment.

 

Set-and-forget, not regret

While direct debits might seem to offer tenants less control, they can actually free them from these problems. They won’t need to worry about entering incorrect details or variable payments, and, if they miss a scheduled payment, they can be contacted immediately.

There are benefits for property managers and landlords, too. Direct debit can drastically reduce late rent payments, allowing you disburse on time, every time. If you take advantage of a fully integrated payment solution like Console Pay for Gateway, there are also huge time savings on other busy work like receipting rent payments.

Sounds good, right? Why not try it out for yourself.

Console Pay for Gateway, powered by Ezidebit, is the industry’s only fully integrated payments solution. Set up simple direct debit payment schedules for your tenants, and let us handle the rest.

 

Hungry for more information on Console Pay? Find out how it can add value to your business in Winning property management wars.