Law firms who accept credit cards get paid 35 percent faster.
But a number of ethics rules come into play.
Stop waiting to get paid.
With Clio Payments powered by LawPay, you now have the flexibility
of accepting credit card payments both in office or via the web.
Get started with Clio now for free at https://landing.clio.com/azbar.
How to Choose a Credit Card
Processor for Your Law Firm
According to the Clio 2016 Legal Trends Report, which analyzed cli- ent time-to-pay for over 40,000
attorneys, law firms who accept credit
cards get paid 35 percent faster.
This can be a competitive edge, but
there are important steps to consider
when selecting a credit card processing
service for your firm.
Step 1. Consider ethics rules for
For many business owners, choosing
a credit card processor is as simple as
comparing the top players—PayPal,
Stripe, and Square, for example—and
deciding what’s best for them. For lawyers, however, it isn’t that simple. Ethics
rules must be considered when accepting credit card payments. Lawyers need
to ensure that their credit card processor
will keep them compliant.
Specifically, lawyers need to consider
the potential for chargebacks on trust
accounts. If a client disputes a charge
that results in a chargeback, and the credit card company withdraws money from
a pooled trust account, this may add up
to an ethics violation.
Law firms need a credit card processor
that does not allow chargebacks on trust
accounts, and that does not take fees
from trust accounts. Usually, this means
using a credit card processor tailored
specifically towards lawyers.
A solution like LawPay or Clio Payments ensures that you have separate
operating and trust accounts, and that
processing fees are deducted from your
operating account only. Thus there is no
concern about an inadvertent ethics violation due to your credit card processor.
Step 2. Compare pricing
Legal-specific credit card processors
eliminate ethics concerns for lawyers
by taking extra precautions that regular
merchant credit card processors don’t.
But that does not mean lawyers need
pay a premium for this service.
A comparison of several top card pay-
ment companies’ cost to process a stan-
dard credit card payment on a $3,000 bill,
shows it would cost about $90 using
PayPal, Square, or Stripe, but just $60 us-
ing a legal-specific credit card processor
like LawPay or Clio Payments.
Here’s a more in-depth breakdown of pricing:
Most credit card processors do not charge
a monthly fee, but LawPay charges users
$20 per month per account. If you have
both a trust account and an operating
account, that means you’ll be paying $40
per month. However, when you use Clio
Payments, Clio covers these fees.
Other legal-specific credit card processors charge lower per-transaction fees,
but charge a monthly rate to cover standard charges from credit card companies.
Visa and MasterCard charge a 1–2 percent
fee per transaction. For example, LexActum
only charges . 25 cents per transaction,
but monthly fees range between $19 and
$99—and there’s no trust accounting
option on the lower-priced plans.
Both Clio Payments and LawPay charge
lower per-transaction fees than third-party credit card processors. Clio Payments is powered by LawPay, so per-transaction fees are the same— 1.95
percent plus . 20 cents per transaction
for most credit cards, and 2.95 percent
plus . 20 cents per transaction for various specialty credit cards.
PayPros Legal charges just 1.69 per-
cent per transaction with no monthly
fees. However, that’s only if you use
their terminal to process payments
(the terminal is $60). Without the
terminal—i.e., if clients want to pay
online—it costs 2. 25 percent per trans-
action, or 2.99 percent per transaction
for specialty credit cards
Step 3. Consider your workflow
A credit card processor that truly works
for your firm is important. Most of the
credit card processors mentioned above
allow for customizable invoices, which is
a must for a professional image for your
Also, consider how your credit card
processor will work with your other practice management tools. If you’re keeping multiple windows open and entering the same information into different
programs, you’re wasting valuable time
on a repetitive task, and increasing the
chance of human error.
The ideal solution would be one that
integrates directly with your practice
management software, so that you can
handle your payments and keep your
records up to date in one place. Clio Payments is one such solution, as it allows
you to bill clients and track payments
from directly within Clio.
Legal-specific credit card processors are
essential for lawyers who use trust accounts. However, even if you don’t use
trust accounts (and don’t plan on using
them in the future), a legal-specific credit card processor may still cost less than
using PayPal or Square.
When it comes to your law firm, every
dollar counts. Accepting online payments
is the easiest way to ensure you’ll get
paid faster, so do your research and find
a credit card processor that works for you.