Here we’ll discuss what a Client Payment-Type Transaction is, and how you can utilize it for your company. For the more detailed steps of posting any type of “Payment” (regardless of the exact type), please see our article on Posting a Payment-Type Transaction.
We will cover what is available, however depending on your business model, you may not use this type of payment, or you may use it in a different way. Feel free to re-purpose the functionality as you see fit.
What is it?
A Client Payment-Type Transaction is similar to a normal Payment-Type Transaction, in the fact that the balance is being paid down on an account.
However, where the Payment-Type Transaction is money being paid to the agency, a Client Payment-Type Transaction is where the individual (debtor) is paying the money directly to the client. Sometimes debtors do this to avoid going through another entity that they are unfamiliar with, or because the client is easier to pay (perhaps a loan office, clinic, or hospital near their home).
- An agency named Simplicity Collections has a debtor named John Doe who owes them $100.
- The agency is working for/on behalf of a clinic called Apple Valley Regional Clinic, and they have a contract with them for 40/60 splits on money collected (40% goes to the agency, 60% to the client).
- Simplicity Collections contacts John Doe and urges him to make a payment on his overdue account.
- John Doe goes directly to Apple Valley Regional Clinic, and pays them $100.
- Apple Valley Regional Clinic alerts the agency, Simplicity Collections, that they received a payment for $100.
- Simplicity Collections can post a Client Payment-Type Transaction on John Doe’s account, showing he (John) paid $100, but that the client received the funds and owes the agency their cut at the end of the month.
- Simplicity Collections uses a report like Reports > Quick Reports > Client Statement to show Apple Valley Regional Clinic that they are owed $40 from the $100 payment. This way the client can send them a check for the $40.
How do you set up a Client Payment?
By default, we supply you with several “stock” transaction descriptions under Financials > Transactions that you can choose from when posting a payment. However, they are all normal Payment-Type Transactions, and no Client ones exist yet.
You will have to go to Financials > Advanced at the top right-hand corner, and create a brand new description:
Once you click Insert New, this description will be available on Financials > Transactions. You can then select it from the drop down list, and put in the necessary information just like a normal payment. Then click Insert Transaction to save it.