Lawyers do vital work, often working around the clock to help achieve positive outcomes for their clients. In these circumstances, struggling to get paid quickly and on time is as frustrating as it is unfair.
According to the 2022 Legal Trends Report, lawyers record only 2.6 billable hours per day on average. The rest of their day goes towards various non-billable tasks, such as:
- Preparing and sending invoices
- Processing payments
- Updating trust ledgers
This is untenable. Lawyers should spend their precious time on high-value client work—not chasing, processing, or managing their payments. That’s why firms are increasingly turning to legal payment software. The best legal software, like Clio’s legal billing app, offers payment solutions and integration partners to help law firms get paid as easily and efficiently as possible.
Let’s explore how it does this.
A typical law firm billing process
The traditional law firm billing process is overly time-consuming and resource-intensive, drawing lawyers’ valuable attention away from other pressing matters. Traditionally, the billing process looks something like this for most law firms:
- The firm brings on a new client and opens its case.
- The firm logs billable time and disbursement fees/expenses through the life of the case.
- The firms put bills and expenses for each client and case in draft at the end of the month.
- Attorneys add notes and adjust costs as needed and approve the bill.
- The firm creates a final version of the bill and sends it to the clients for payment.
- Clients pay via whatever payment methods the firm accepts.
- The accounting team sends follow-up reminders regarding late payments.
Unfortunately, this billing process leaves much to be desired. There’s plenty of room for bottlenecks and wasted costs. Lawyers are spending too much time on non-billable hours/non-lawyer activities. Truthfully, no one goes to law school so they can spend their days creating bills or chasing down late payments.
Think about it: why waste time completing unpaid work in an effort to maybe get paid for previous billable work? This is nonsensical. Something has to change, fast.
How legal software modernizes the billing process
Leading firms are shifting to modern payment options, implementing legal billing apps that free attorneys from having to create, send out, and chase up invoices. For example, Clio’s attorney billing software allows firms to:
- Improve timekeeping
- Bill consistently
- Send regular reminders
- Provide alternative payment options, such as credit cards or payment plans
Our attorney billing software provides an experience designed for both firms and their clients. Firms benefit from automated timekeeping and billing—while clients gain the flexibility to pay using a range of potential payment options.
Why online payments?
Implementing attorney billing software is just the first step—you also need to ensure you’re keeping clients happy.
Pre-pandemic, we saw digital payments trending, and this truly lifted off during the pandemic. Everyone suddenly had to use online channels to make purchases—there was no alternative. Indeed, consumers now expect flexible online payments across all areas from purchasing groceries online, buying big-ticket items like a new couch, and of course, paying off their legal bills.
Research shows that 65% of legal consumers prefer to pay online, and 57% of bills that include an online payment link get paid on the same day. As Erika Holmes, ELHolmes Legal Solutions, comments, “The concept is simple. The easier you make it to pay, the more likely they are to pay.”
“My intake and collections process is much quicker than before. From sending a bill to getting paid, it is now one day instead of a whole week. I can send a client an agreement with a payment link and get paid that day, which means I get started right away instead of waiting for a check in the mail.” According to Anna Valiente Gomez, Solo Attorney
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How law firms can get paid faster
The bottom line is simple, when you provide clients with a range of options, supported by tech that streamlines billing and payments, your firm gets paid faster. This approach can even boost revenue—consider that Clio customers using online payments collect between 5% and 16% more monthly revenue. What’s more, these law firms also see 8% more new cases each month, indicating that clients are leaning into the idea of a completely remote experience.
Learn more about how online payments can unlock revenue at your firm by watching our billing and collections webinar.
Using Clio’s legal billing app integration partners to streamline payments
Whether you’re a new law firm or a well-established industry heavyweight, your attorneys need tools to help them streamline their billing and collection processes while providing clients with flexible payment options.
Take Clio Manage, for example. Firms can now use Clio Manage to send bills and collect payments online with the click of a button. It streamlines every aspect of the legal billing process by offering:
- Automatic time tracking
- Fully customizable invoices (based on a range of reusable templates)
- A built-in approval system
- Direct integrations with your firm’s accounting software.
Clio also has an extensive library of partner integrations, with many specifically aimed at easing the billing and payments processes. Pick and choose which integrations will best serve your firm—and your clients—to create a customized billing workflow according to your specific needs.
5 payment integrations to help your law firm get paid faster
1. Text Request
Text Request is a business texting platform that boosts client engagement, allowing firms to meet clients on their most well-used channel: their mobile phone. Firms can trigger text message billing notifications and payment requests, schedule and confirm appointments by text through their Clio account, and sync messages from Text Request directly across to Clio. Clio’s Communication page instantly stores these conversations on the contact’s corresponding page.
2. Split Billing
Split Billing allows firms to bill multiple clients for portions of the same work in Clio. They can save their activities to one matter before dividing it up between any number of clients. Firms can also make use of the entire Faster Suite, which includes Faster Time and Faster Invoicing.
3. Invoice Tracker
By integrating Clio with Invoice Tracker, firms can improve cash flow and efficiency. The tool sends automatic email reminders to follow up on unpaid invoices, which saves an estimated 7+ hours per week in accounts receivables administration and boosts the chances that clients will pay promptly. Win-win.
4. Kolleno
Kolleno has designed an optimal collection strategy that helps firms get paid quicker while preserving client relationships with friendly payment reminders. This program will find the best channel, time, and messaging approach for each client automatically, increasing the likelihood of clients paying on time, every time.
5. Colossus by Legal DNA
Colossus enables firms to manage their matter lifecycles more effectively, like billing status. It automatically color codes bill payment statuses so you can quickly see problems and manage their portfolio, while the software provides automatic recommendations about when to bill and call clients for collections.
Final notes on legal billing apps
Law firms shouldn’t struggle to get paid on time. Not only is this unfair, but it’s also an unwelcome distraction that takes lawyers’ focus away from other, more crucial activities. There’s little point in experienced lawyers spending their days chasing overdue invoices—their time is far more valuable than this.
Take control over your billing and collections process by using Clio Manage, and by taking advantage of our wealth of additional integrations. Implement automation where possible to reduce manual effort and streamline the billing process. Leverage ready-made communication templates to minimize complexity and boost efficiency.
Give your valuable fee-earners the capabilities they need to focus on client matters, instead of on chasing payments. Boost cash flow while preserving client relationships, providing flexible payment options and client-centric collections reminders.
To get started, sign up for a 7-day free trial of Clio Manage.
We published this blog post in November 2022. Last updated: November 14, 2022.
Categorized in: Accounting
