With the expansion of technology, there are so many new payment methods available to property managers and residents. When you are looking into giving your residents more payment flexibility, you may want to consider online payments in addition to your standard cash payments. Both payment systems offer pros and cons, so consider these before changing your payment system:

Cash Rent Pros

  • Cash payments are the easier to track and require less bookkeeping processes.
  • There is less risk of fraud or identity theft with accepting cash payments.
  • There are no fees with accepting cash payments.

Cash Rent Cons

  • Cash payments whether through cash or check are easy to lose. When you are running to the bank to deposit or trying to keep track of the payment within the office, you might end up losing the payment which can be a bit of a financial hit.
  • Cash payments are easier to steal. Though most staff are trustworthy, when you are going to the bank to deposit cash and checks, there is a risk of having your payments stolen.
  • Most residents are not paid in cash and checks are outdated with all the new payment systems available. So having a cash payment system may be more difficult for your residents and even more costly if they have to withdraw money from an ATM.

Online Payment Pros

  • Online payments are very easy Your residents simply sign onto a website and transfer the money.
  • Online payments are very quick. Usually within minutes of making the payment, you will have the money in your account.
  • Online payments can be setup to automatically withdraw which means your residents will be able to more easily pay their rents on time.

Online Payment Cons

  • Many online and credit card systems have heavy processing fees which cut into your profit margins.
  • Residents may dispute a payment transaction with their card company which could end up costing you money.
  • Online payments are prone to security leaks so you have to be very diligent about monitoring your transactions.

 

Both cash payments and online payments have their benefits and downsides. Deciding between the two really comes down to measuring these pros and cons and thinking about which system is best for your unique residents. You can also consider doing a mixed system where you accept both forms of payment. The bookkeeping will be slightly more challenging with accounts payable coming from different sources, but your residents will enjoy the flexibility.