The concept of digital payments has been around long enough that most people don’t question the speed or convenience of, for example, splitting a restaurant bill using Venmo, or paying rent through an app.
If residents are still paying rent using paper checks or money orders, it might seem like a relatively small inconvenience, but there are more problems with paper checks than just the slower processing times.
When we surveyed property management professionals at a recent conference, they shared that it takes a team (on average) two days to scan and process checks during the rent cycle week. That’s 40% of a team’s working week during the rent cycle, wasted on paper processing!
But there are other reasons beyond saving your team time why you might want to reconsider your residents’ payment options:
Paper Is Not Secure
In our survey, over 60% of property managers said they believed that digital payments offer a security advantage.
The reason is simple – paper payments open themselves up to far more theft, fraud, and loss than is possible with a digital payment. Paper checks also need to be stored securely while they’re in your possession (up to a full year after processing); a cashed check will still have the resident’s account and routing information printed directly on it.
Then there’s plain old human error, which is much more common when dealing with paper than with digital payments. Residents might not always accurately fill out a money order, or there might be additional payment information you need (such as the apartment or unit number) that’s frequently not included. Paper can get damaged, lost, or stolen. A resident who’s using a money order to pay rent, but then loses it, is in a different kind of pickle entirely.
Paper Is Not As Reliable or Convenient
Beyond security, paper is simply not as reliable a payment method as digital. Digital payments allow residents to set up autopay, deducting the appropriate amount on the same day every month that the resident can set themselves. This eliminates the need for residents to remember to write a check or get a money order together entirely; the money simply transfers automatically every month.
Residents also won’t need to adhere to their community office’s hours of operation or ensure they have a check to write in the first place when they can use digital payments. The money transfer is done securely from the resident’s phone or desktop access to their account.
Setting up digital payments is also a better option because of the secure encryption options. There’s no paper trail, which can be susceptible to privacy or security issues, required with a digital payment. Instead, payments are sent directly from their phone or computer to the bank.
And, As Stated, Paper Is Slow
To get rent money from a resident’s account into the property owner’s account requires jumping through several hoops that seem absurd in 2022. Yet some people still jump through them every month.
- The resident needs to order paper checks in advance or visit a participating money order supplier during working hours to get a cash alternative check.
- The paper payment needs to move from the resident’s possession to the property manager’s. This might involve mail or a physical drop-off from the resident.
- The property manager (or team member) scans the payment.
- After all of this happens, it will still take a working day or two before the money is transferred from the resident’s account into the property management account.
- The property manager must then file away that cashed paper payment and hold onto it for a predetermined period.
An encrypted payment, even one involving paper, is much shorter. After the resident gets their check or money order together, they can scan it into the app, eliminating everything after the second step of the process. The money will move from one account to the next without the paper payment leaving the resident’s possession at all.
Yes, Digital Payments Are Better
The vast majority of property managers (87%) who took our survey said that they think their residents are ready to go digital, and it’s easy to see why! Digital payments are more secure, more reliable, more convenient, and faster than paper payments, especially when you partner with a payment platform that offers extra layers of assurance, such as chargeback protection.
If you’re interested in truly digitizing your resident payment experience, our features can help make it painless for you and still accommodate paper payment options for residents.
Ready to chat about how Domuso can help your organization? Request a demo today.Request Demo