As one of the multifamily industry’s largest providers of online payment solutions, we keep a close eye on the kinds of larger national trends that can affect our business and that of our clients. Last year, we saw reports indicating that more than 80 percent of Americans prefer to manage their household finances online, and 79 percent of renters prefer to pay rent online or via smartphone. That made us wonder why — if these reports are true — are only 32 percent of the residents we serve taking advantage of online payment options when they’re available?
We decided to do a little digging and identified 25 clients with the highest percentages of online payment adoption. Then we interviewed each of them to ask how they handled online payment programs at their properties. Over the course of those conversations we were able to uncover several consistent practices that correlate to high payment participation, some very predictable, and others very surprising.
For example, each of the top payment-processing companies offered online ACH payments to residents at no charge and sent consistent email rent reminders. Many invested in site-level training and marketing collateral to help both staff and residents at the property understand the benefits of processing rent online. Most introduced their resident portal and online payment process to residents during lease signing, and offered computer or tablet workstations in the leasing office for residents to make online payments. Some even sponsored competitions between properties or residents to encourage participation.
But two properties were different. While most of the top 25 were getting as high as 50 percent online payment participation, two caught our attention for capturing between 80 and 90 percent. What was the difference? They had gone paperless. These companies messaged to their residents that the leasing office was transitioning to paperless payment processing. Residents were asked* to pay rent online (either via eCheck or credit card transactions). Alternatively, residents could pay by cash at one of any 37,000+ MoneyGram locations through a paperless money-order.
As a result of this one simple policy shift, online payments increased, delinquencies dropped, theft and fraud levels decreased, data entry errors were eliminated, and property personnel were able to use hours previously dedicated to rent processing on activities promoting resident satisfaction and retention.
We took this paperless program to other clients to see if we could replicate the success across a variety property types, locations, and demographics and, in the last four months, each of the clients who has rolled out a paperless program has seen significant increases in online payment processing. In fact, just a few months into testing at over 200 properties, our clients are already on pace to match the results of the top two processors. That translates to more residents paying rent the way they prefer (online), more properties reducing rent-week workloads, and a lot less paper checks.
We’ve worked on creating a program that is scalable and is easily adopted by any of our ResidentPay clients. This Paperless program is available now free of charge. We’re offering customized training and printed materials for any property that chooses to participate. The benefits are real. So why not go paperless? Schedule a demo to get started, or contact your CSM for more information.
*Properties were still able to accommodate the outliers—residents who insisted on paying via paper check on-site because of eviction processes, etc.—while the majority of residents transitioned to online payments relatively easily.