Today, lawyers spend six hours a day on non-billable work. As a law firm professional, you likely witness this every day. Between calculating bills, sending individual invoices, and client follow-up, payment collection efforts take tremendous time and energy.
Many law firms use more than one tool to collect their payments. For example, a law firm may use one tool for time and expense tracking and another for business accounting and invoicing. This disjointed approach can waste valuable time and add unnecessary pressure to your workload.
2025 is a new start, and building a strong payment collection foundation is a priority for firms that want to get a better return on their time. Below, we’ll provide insight into the best practices and trends for payment collection success in 2025.
Collect payment methods up front
Did you know that 90% of late payments happen because of unclear billing processes?
A simple way to avoid this is by asking for payment details up front. This makes it easier to send bills, set up payment plans, and avoid overdue accounts. By storing payment information securely at the start, you save time chasing payments and give clients a smoother, more straightforward experience—all while keeping your firm’s cash flow steady.
Some clients may hesitate to provide payment details due to security concerns or a lack of trust—however, there are strategies to create transparency and trust between your firm and clients to mitigate these concerns.
Addressing client concerns about payment
With the risk of data breaches and financial loss, clients have valid reasons to be concerned about providing their payment information upfront. The best way for law firms to respond is by acknowledging the concerns and through a lens of transparency.
These best practices help law firms collect payment details while easing client concerns:
- Set transparent payment policies in place: Clearly outline when and how payment information is collected. Sharing your policies upfront puts you and your clients on the same page right out the gate.
- Use secure payment systems: Make it a priority to use industry-compliant payment collection software. When clients see that your firm relies on software that is industry-certified and PCI-compliant, they feel more at ease in disclosing their financial information.
- Offer mobile accessibility to the client portal: Consider a payment software that allows users to access their information and pay bills on the go. Mobile accessibility offers practicality for your law firm and gives clients a stronger sense of control over their data and payments.
Six Essential Features in Your Legal CRM (and How to Use Them)
While your legal practice management software keeps the daily work of a law firm moving, legal CRM software makes it easier to bring in new clients, engage current clients, and increase your profits. But not all legal CRMs are created equal. Look for these six features when choosing a legal CRM—and put them to work for your law firm.
Optimize the invoice process
A well-structured invoice template can increase the chance of invoices being paid on time. The ideal invoice template includes the following:
- Clear and concise instructions on every invoice
- User-friendly payment link that leads directly to the client portal
- A list of accepted payments and payment terms (e.g., when it’s due)
- Outlined lists of services and costs for the invoice
It’s also important to be consistent about sending invoices. If your clients only receive invoices sporadically, they’ll pay them sporadically. Batch generating invoices on a schedule can make it easier to get invoices out.
Multi-channel reminders to ensure on-time payments
With cluttered inboxes, invoices are missed more often than not. According to a 2023 survey, 55% of businesses had outstanding invoices from the previous tax year. Law firms can take a multi-channel approach to improve the efficiency of their invoice processing. Instead of only sending invoices through email, texts and app notifications can be effective reminders, too.
CosmoLexPay enables our law firms to send dynamic reminders. Law firms can embed links and reminders into text messages that lead right to the client portal.
Law firms with high invoice payment rates use a consistent reminder strategy that includes email, text, and other forms of communication. By adapting to client preferences, law firms can meet clients where they already are.
Set up automated payments
One way to reduce collection stress for your law firm is through automated payment. Law firms that provide scheduled payments make their clients feel empowered and cared for—but they also experience significant benefits themselves.
Advantages of automated payments for law firms
- Save time: With automated payment processes, law firms don’t need to worry about chasing down overdue invoices.
- Remain compliant: Compliant software provides legal invoices that always align with the latest rules and regulations.
- Reduce human error: Automation limits human error such as inputting the wrong contact information or due dates.
- Improve reporting: Built-in reporting collects client invoices and makes it easier to view data and trends.
Advantages of automated billing for clients
- Save time: If clients opt into automatic billing, they don’t need to spend time manually paying invoices.
- Peace of mind: Clients won’t need to worry about late or missed payments.
- Increased transparency: Clients can access their payment history, invoices, and other billing documents whenever they need them.
Integrate payment solutions with practice management software
When your payment solution is integrated with your practice management, time tracking, invoicing, payments, and client communication tools, it gives your firm one spot to manage all activities related to payment and collections.
With CosmoLex, your law firm can:
- Automate invoicing: Turn tracked billable hours into professional invoices.
- Simplify payments: Clients can securely pay directly from the invoice.
- Streamline communication: Send automatic payment reminders and updates.
- Reduce errors: Avoid manual data entry by keeping all processes in one system.
An integrated approach ensures your payment process is faster, easier, and more reliable for both you and your clients.
Improve client trust with secure storage
According to a 2023 American Bar Association survey, 29% of law firms experienced a security breach, often putting sensitive payment information at risk. A breach not only damages client trust but also disrupts cash flow and leads to costly regulatory fines.
To keep payment collections secure and efficient, law firms need:
- End-to-end encryption: Protect client payment data during transmission and ensure only your firm can access it.
- Regulatory compliance: Use PCI-DSS compliant solutions that meet trust accounting, AML, and KYC standards.
- Centralized storage: Securely store payment details within integrated practice management software for streamlined collections.
CosmoLexPay provides the security and compliance you need to safely collect payments while maintaining client confidence.
Take advantage of CosmoLexPay in the new year
If payment collection success is on your radar in the new year, we’re here to help you meet that goal. From initial contact to final payment, CosmoLexPay is an integrated tool designed to streamline your payment processing.
Schedule a one-on-one demo or start your free trial of CosmoLexPay today.
Six Essential Features in Your Legal CRM (and How to Use Them)
While your legal practice management software keeps the daily work of a law firm moving, legal CRM software makes it easier to bring in new clients, engage current clients, and increase your profits. But not all legal CRMs are created equal. Look for these six features when choosing a legal CRM—and put them to work for your law firm.
The post Setting Yourself Up for Payment Collection Success in 2025 appeared first on CosmoLex.