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This New Year, Will You Optimise Your Business Cash Flow?

As business owners, entering a new year means more than gym memberships and quitting bad habits. Personal goals aside, there are also New Year’s resolutions for the business. To provide better customer service, improve engagement on your social media channels and optimise cash flow once and for all, to name a few.

Many of these goals tie in to the overall cash flow of your business, which ultimately affects your daily operations and can become just as disconcerting as general revenue problems.

The consequences of poor cash flow are detrimental and can pave the way for a path to hindered growth, low profit margins and at worst, business failure. Not exactly how you’d want to ring in the New Year!

Yet, a business can still be profitable despite its negative cash flow, which explains why poor cash flow management is still ubiquitous in the majority of businesses, from homegrown startups to multinational corporations.

Sometimes, it’s just habits that stick. Especially in a nation like Malaysia, where payment terms are seen as more of an option than a priority, and getting paid on time is a rare case for joy.

But this new year, make it a point to optimise business cash flow by leaving behind these bad practices in the previous year and implement these techniques to optimise cash flow.

old school telephone to invoke vivid imagery on chasing late payments in the old days

Being afraid to approach clients for late payments

Instead: Offer discounts for early payments and penalties for late payments, implement automated solutions.

Undoubtedly, one of the biggest factors which affects the ability to optimize cash flow within a business is the bad practice of late payments.

It’s not uncommon for invoices to go unpaid for months, with buyers completely ignoring the payment terms stated in black-and-white and sellers not following up consistently, resulting in an increase in tension within the relationship.

Alternatively, for those on the buyer’s end, late payments can result in a loss of trust, endless frustration and the altogether loss of a client. So, what are some cash flow management strategies that can help break through this vicious cycle?

One solution is offering incentives for buyers who are early or on-time with payments, and implementing high interest rates for late payments exceeding the due date.

Despite this, many buyers will still not abide by the payment terms. An even better solution? Avoiding the topic of confrontation altogether by automating the invoicing and payment processes.

Direct Debit, for example, can help to collect payments from the buyer on date every month, mitigating the need to waste time, resources and manpower to follow up Every. Single. Time.

Forking out unnecessary funds and wasting resources

Instead: Save time and money by using Direct Debit to collect monthly payments.

Ask yourself this, how much time and money are you really spending every month on late payers?

You might not want to know the answer. Most recently, a US-based study from Sage reports that late payments are costing SME’s up to $3 trillion annually. That’s 12 zeros.

The report states that over 30% of SME’s viewed the client relationship as the number one barrier hindering them from chasing payments as aggressively as they’d like to.

“As a consequence of late payments, 16% in the US say they will struggle to pay bonuses around the festive period, and nearly 25% expect an impact on staff pay.”

Employee work hours, overtime, admin fees and the other extra costs can be almost invisible at times. That is, until it starts to pile up.

What can you do about it? One of the most efficient ways to optimize cash flow would be to use Direct Debit to make the payment collection process effortless and essentially, let it do all the dirty work for you.

Not managing your inventory well

Instead: Forecast well to reduce costs.

For many businesses, better business cash flow can even stem from optimizing inventory management.

Accurate forecasting for one, can ensure that you’re meeting demand while optimising inventory levels to maintain healthy net working capital.

Another method which has allowed previously irreducible cost centres to see gradual decreases over time is by supplementing robust SOPs (standard operating procedures) with technical competence in data analytics.

In many industries, expertise in supply chain analysis has also evolved to a point where the usage of advanced machine learning algorithms is regularly employed to optimise just-in-time inventory.

Sometimes, the issue may be, to put it simply – human error. Say, a miscount in inventory or erroneously processed orders. Automating such processes by using Curlec to pay for your orders on a regular schedule can help to reduce the risk of human errors. Find out how to do that by contacting us below!  After all, we’re only human right?

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Smarten Your Payments With RHB And Curlec

For Curlec, servicing and improving the education industry is part and parcel of being one of the pioneers in changing the way Malaysia is making payments.

In the education sector, problems with payments arise when it comes to collecting fees from students or their parents on time. Despite the many solutions present today, the age-old issue of having to chase after the other party is still present in nearly every industry.

Because of this, institutions tend to adopt one too many different payment channels which through Curlec, can be easily consolidated into a single method while still remaining flexible enough to adapt to different situations. Not to mention, all the administrative hassles and problems that arise when having to reconcile payments, a task that proves to be effortless by syncing Curlec with accounting systems.

Recently, Curlec had this exact opportunity to discuss ideas on improving operational efficiency in the education industry and to share their knowledge on how Direct Debit can help resolve said issues in a joint workshop with RHB.

Smarten Your Payments With RHB And Curlec

Orbit, a startup co-working space in Bangsar South hosted this workshop, where clients of RHB in the education industry gathered to attend “Smarten Your Collections with RHB and Curlec”, a joint effort by RHB and Curlec to discuss methods on improving payment collections in the education industry.

As a fast-growing and innovative FinTech startup, Curlec aims to make payments seamless for all. For this workshop, the different online payment methods typically used by those in the education sector were covered, along with how payment methods like Direct Debit and FPX in particular could be the missing link when it comes to solving the multitude of problems associated with payment collection for educational institutions.

Curlec makes use of Direct Debit and FPX to tackle issues mentioned above like the collection of school fees. To date, such processes are still done manually, requiring a massive burden to be constantly heaving on the shoulders of a school’s employees. This is where Curlec steps in to relieve that burden. Authorised, automatic withdrawals from the bank account of students or parents can be done on a customizable date, all the while ensuring employees still possess the ability to make any changes when the need arises.

Additionally, administrative hassles like advanced notifications and reminders for outstanding dues are all tasks that can be put into Curlec’s hands. This means employees in charge of admin or accounts can rest at ease and put their focus on other tasks.

Digitising the classroom experience isn’t a foreign concept for most schools, though digitising administrative processes seems to come in second place. Transitioning to more modern mechanisms such as Curlec helps in driving efficiency by reducing the percentage of errors and minimising employee workload, which in turn allows more space for growth. This will help to keep institutions one step ahead of the game.

Find out how we can help in smartening your payments by filling out your contact details below, no matter what industry you’re in.

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5 Ways To Know If Your Business Needs A Payment Method Change

For most business owners, the method in which you collect payments from your customers can mean the difference between a customer gained or a customer lost. And with the vast array of payment methods to choose from, it’s only normal to feel that “As long as payments are coming in, I’ll accept whatever form it comes in.”

But such decisions can have a lot of side-effects and doesn’t work for all businesses. And even if your business relies solely on one payment method, doing so might mean that there’s still space to improve, especially in an age where buying habits and expectations are constantly shifting with the times.

Still, the most common mistake small business owners fall prey to is a failure to change by sticking to “tried and trusted” methods. If you’d like to know whether your business can benefit from a change in the way you collect payments, read on to find out some of the telltale signs that a significant change is due.

 

1. You have to chase after customers every month for payments

Whether it be gym memberships, monthly subscriptions or payments requiring invoices, recurring payments are something present in many businesses. And unless you have a surefire way of ensuring your customers stick to their promise, there will always be a select percentage of customers who seem adamant on making the lives of you and your employees harder.

Such customers will use any means possible to avoid the responsibility of paying up despite the countless emails, calls and messages. Perhaps they repeat the same excuse over and over to delay, or claim that they’re overseas (even though months later, it’s questionably still the same excuse).

The outcome? Extra stress on employees, extra costs incurred for the follow-ups, and very likely – a lost customer. This is one of the reasons why automated Direct Debit can help establish a friendly relationship with you and your customer from the get-go and hinder the possibilities of them pulling any tricks halfway down the road.

 

2. Delayed payments due to late invoices are commonplace

A survey by the SME Media Group and Inti International University shows making late payments has become a very common problem in Malaysia, with 73% of business operators saying it was Malaysia’s business culture.

Surely, this is something most business owners can relate to. Despite having the payment terms in black and white, companies simply refuse to abide by it. If you’re a small business owner, such culture and habits can be detrimental, as explained by the Atradius Payment Practices Barometer Survey.

“Unpaid invoices can have a serious impact on a businesses’ turnover or cash flow. Not only because non-payment by buyers costs a business time and money in respect to pursuing collection of debts, but also because bad debt reserves represent money that is unavailable for use in growing the business. In addition, the longer the receivables remain outstanding, the lower the likelihood of turning them into cash.”

Such complications can be avoided by using a payment method which enables trust on both ends. Curlec allows businesses to set a date which can be discussed with the other party beforehand to ensure that payments can be withdrawn on an agreed date, a feature the usual manual or online bank transfer lacks. Read more on how to get your business paid on time here.

 
3. Keeping track of cash/cheque is a headache

Cash and cheque are two of the most traditional  payment methods used in Malaysia. However, the cons of using these payment methods outweigh the pros. With cash, you might find that keeping track of everything in the cash register can be an absolute headache. Cash not totalling up at the end of the day and mysteriously going missing… Plus, keeping huge sums of cash only puts your business at risk of losing said money to internal or external theft (another constant worry!)

Cheques on the other hand, place and even greater strain on the business when it “bounces” due to insufficient funds. Extra costs involved, administrative annoyances, and time spent following up just isn’t worth it.

 
4. Your fees for online payments are through the roof

Online payment gateways such as PayPal, are convenient and all-inclusive payment methods, that are particularly useful for ecommerce transactions. But there’s one thing most businesses can agree on – the insanely high fees. Set up fees, annual fees, transaction fees, the list goes on. Take PayPal for example. Merchant rates for up to RM12,000 for Malaysian customers is 3.9% + RM2.00 per transaction. Such fees can slowly but surely eat away at your business’ account and though they don’t seem like much, over time they can accumulate and make a significant dent. In comparison, Curlec’s services only charge 1% per transaction, capped at RM10, with no other hidden fees.

 
5. You find yourself doing too much admin

Often overlooked are the tangible side-effects of using payment methods which may not be the most suitable for your business. Namely, time wasted and all the manual work required. Take cash payments for example, employees will be required to manage the cashier, collect cash and tally the total once or even twice a day, only for the possibility of them pickpocketing from the till. Plus, not to mention the costs and time involved in hiring and training new employees! With automatic systems like Curlec for example, there’s hardly a need for an employee at all.

High employee and material costs actually play a huge factor as well, though when considering payment options, not many business owners take this into account. Equipments such as payment terminals to accept debit / credit card payments and cash registers may also not be worth it at times. But with Direct Debit, all you need is a laptop or computer.

If you’d like to know what payment method suits your particular business best, connect with us by filling up the form below this page!

 

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A Payments Workout for Malaysia’s Fitness Industry

Malaysia’s fitness industry is an active one and has seen huge gains in recent times. The rise of boutique studios, gym classes and the introduction of fitness tech platforms has seen Malaysian fitness-enthusiasts spoilt fo r choice. As a result of this, the need to discover differentiating factors has become crucial in order to survive the competition in an increasingly crowded industry.

One of the factors that has, until now, been overlooked relates to flexible membership and payment options for gym members. Now more than ever, consumers are expecting smarter ways to pay that place emphasis on customer experience and relationships. With the proliferation of gyms and fitness studios in Malaysia, players in the industry are now starting to use Curlec’s Direct Debit solution to collect monthly membership fees to address this change in customer behaviour.

So why use Direct Debit to collect membership fees? At Curlec, we believe that customers see value in your overall gym experience, including payments. Using Direct Debit not only helps with that, but it also allows your business to flourish in three main ways:

1. Reduces Membership and Payment Admin

Taking payments by cash, cheque or credit cards can be a huge administrative burden that requires plenty of manual work. In contrast, Direct Debit payments puts businesses in control of when they get paid and can be completely automated. You can set up membership plans online instantly so your customers can get started straight away.

Additionally, our easy-to-use portal will keep you updated of exactly who has or hasn’t paid without checking your bank statement. This eases the administrative burden of chasing customers for non-payment, whilst our Instant Pay FPX payment gateway gives your members the opportunity to make one-off transactions through an alternative method. The result of all this, is that you can have peace of mind over your cash flow and focus wholly on developing your business.

Union Strength was an early adopter of the Curlec system and as founder Carlos Villa explains:

“Curlec has enabled us to reduce our cash flow risks and taken away the administration associated with payment collection. This means that we can focus on what we do best – helping our members meet their fitness goals.”
2. Gives You Payment Flexibility

Occasionally, your members may want to change their membership plan or make inconsistent payments to suit their training needs. For example, a member may choose to go on a one-month personal training program in addition to their usual membership subscription.

Therein lies the beauty of Direct Debit – it is a payment method that is catered for variable payments. If you take payment by standing order, this will cause difficulties as it is always for a fixed amount and controlled by the customer. This creates unnecessary work for your members and may even lead to members letting their membership lapse. Direct Debit, on the other hand, reduces friction in your business by putting you in control of setting the maximum amount you would need to charge your customers, without the need to request any further authorisation. This flexibility also allows you to charge your customers on a pay as you go basis without needing further authorisation.

3. Improves Membership Retention

Many existing gyms and fitness centres that offer recurring membership payment plans use credit and debit cards, which inherently creates problems. Firstly, card payments are subject to failed transactions due to cards expiring or being cancelled. This leads to a bad customer experience for your members and creates unnecessary work for them to update their payment details. Worst of all, if payment details are not updated, the customer’s membership may just lapse. In contrast to this, Direct Debit payments use a customer’s bank details, which rarely change or expire.

Additionally, when authentication is given for a Direct Debit this serves two purposes: (1) it acts as authorisation for a business to collect payments when they are due and (2) acts as an instruction from a customer to their bank to enable these payments. Payments made via debit/credit cards only enable the first level of authority, thereby subjecting each transaction to the mercy of a bank’s internal risk team. This leads to a greater level of failed payments due to the potential risk of fraud.

Curves were previously subject to these issues caused by credit and debit cards before moving to Direct Debit. Their CEO, Alison Chin, stated the following:

“Changing your payment system can be a daunting task for any business, as you don’t want to disrupt your existing processes and potentially affect your cash flow. The move to Curlec was simple, with their easy to use system and everything explained clearly along the way by their Customer Success team. The support by their Team post implementation has been great too. I would recommend Curlec to any business that operates on a recurring billing model.”

If you would like to find out more about how Curlec can help with your membership payments, check out our dedicated gym page here.

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How To Encourage Your Customers To Use Direct Debit?

You want to start using Direct Debit as your primary payment option for your customers due to the benefits that it brings to your business. From automation and flexibility, to low costs and low failure rates, maximising your company’s Direct Debit uptake is key to realising its full impact.

So, how can you encourage more of your customers to pay via Direct Debit?

This is a question that we have been asked by a number of our clients and at Curlec we are strong believers that Direct Debit doesn’t benefit just your business, but it brings a whole host of advantages to your customers too. Advantages that ultimately, add to the quality of services that you are delivering.

Below are some methods that you can use to increase Direct Debit uptake amongst your customers.

1. Offer Incentives

Who doesn’t love an incentive or a discount? The truth is using Direct Debit brings a whole host of cost, time and admin savings to your business. These savings can be passed on to your customers to encourage them to start paying by Direct Debit. Here are examples of how some of our clients have used incentives:

  • Discounted monthly fees
  • Waiving of upfront fees
  • A gift for those paying by Direct Debit!
2. Explain to Customers the Benefits

Direct Debit doesn’t just benefit you as a business but it also makes the lives of your customers much easier. Regular bill payments become automatic and customers no longer have to worry about services being suspended due to non-payment.

There are a number of benefits that can be easily articulated to your customers. For example, Direct Debit only requires a one-time sign up and following this they don’t have to worry about triggering the payment again, saving them time and hassle in the future. Explaining the benefits using other relatable behaviours is also a useful tactic, such as the example of the difference in ease between paying your phone bills via a postpaid plan versus a prepaid one.


3. Offer Peace of Mind

We understand that some customers may have concerns over paying by Direct Debit due to businesses being put in control of when they get paid. However, be sure to highlight that customers are also empowered in this two-way relationship.

When your customer signs up for their first Direct Debit with a Curlec merchant they get created with a free account on our system. It is here where customers can monitor all their payment transactions in real time. On top of this, your customer retains control over when to terminate or amend their Direct Debit mandates (subject to any other commercial agreements with you) and this can be easily done within the Curlec portal.



4. Make Direct Debit your Preferred Payment Option

If you want to influence your customer’s payment choices you could explicitly state that paying via Direct Debit is your preferred payment option. In some cases, we’ve had clients who have removed other payments options altogether or introduced barriers to nudge customers to pay by Direct Debit.

In an online setting you could make Direct Debit the first option on your website’s payment page. This would indicate that this is your preferred payment option and get the attention of your customer.


5. Be Honest

There is truth to the saying ‘honesty is the best policy’. In some cases, it helps to be honest with your customer by explaining to them how Direct Debit will help your business due to the reduced admin and cost savings you will make.

This tactic is particularly useful for smaller businesses with a close relationship to their customers, like a boutique gym or social club.

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5 Ways Curlec Helps SMEs With Direct Debit

Malaysia is no stranger to Direct Debit, as this payment service has been available since 2010. However, up until now, it has remained an extremely underutilised system due to the high costs and administrative burden associated with running the previous paper-based process. This has resulted in Direct Debit solutions being exclusively reserved for large organisations that have the resources and capabilities to facilitate it.


SMEs have thus been overlooked by traditional financial institutions as they do not have the volumes or internal processes to handle Direct Debit payments. This has resulted in a large void for SMEs due to the lack of suitable alternatives available to them, particularly for recurring payments. This is emphasised by the fact that the average bad debt per company in Malaysia stands at a staggering RM52,100 with an average 94.1 day credit period, as discussed in our previous post.


It is clear that SMEs have been underserved nationwide and payment collection continues to be a big problem. At Curlec, we are changing this and providing a Direct Debit solution to businesses of all sizes. Here are 5 ways that we are helping Malaysian SMEs:


1) Improve Cash Flow

Direct Debit puts you in control as it lets you collect payments whenever they’re due. This means that you can spend less time chasing payments and increase the volume of cash your business has on hand at any given time.


2) Reduce Costs

With Curlec, you can avoid costly credit and debit card transactions. This is because Direct Debit payments are routed outside of card networks such as Visa and Mastercard, making it considerably cheaper for you.


3) Focus On Your Business

Once authorised, you can take payments from customer accounts with no further action needed from them. This lifts a huge administrative burden as payments become automatic, leaving you time to focus on growing your business.


4) Increase Customer Retention

Curlec is a great way to encourage customer retention and attract recurring revenue. This is because Direct Debit creates a simple payment method that can easily be renewed and maintained over long periods of time.


5) Better Accounting

Curlec easily integrates with accounting systems, meaning that collecting payments become automatic when invoices are due. Once you’ve received a payment, Curlec will mark the invoice as being paid allowing for automatic account reconciliation.


We understand that cash flow and managing money is the lifeblood of SMEs. With Curlec taking care of your payments, you take a huge amount of the hassle out of handling these processes. You no longer need to waste precious time chasing customers for late payment and can instead get back to focusing on growing your business with the peace of mind that there will always be money in the bank, all year round.


If you are interested in finding out more about Curlec please reach out to us here by filling in the contact form below this page.

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5 Things To Know About Direct Debit

Direct Debit as a payment option has been extremely underutilised in Malaysia. When compared to countries such as the UK, where almost 9 out of 10 adults have at least one Direct Debit, Malaysia lags far behind.



This is all about to change with Curlec as our solution using Direct Debit brings payments into the digital age.

Check out our infographic below to find out what Direct Debit is all about:



Direct Debit infographic
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How To Get Your Business Paid On Time

Have you ever had to chase customers for late payment? You’re not alone – the average bad debt per company in Malaysia stands at a staggering RM52,100 per annum, whilst it takes an average of 94.1 days for businesses to get paid.

Late payments clearly put a significant amount of strain on your business’ cash flow and removes the ability for you to plan for the future. Chasing overdue invoices also requires plenty of time and resources, which ultimately impacts your bottom line. It is because of problems like these that Curlec has developed a solution using Direct Debit that will ensure your business gets paid on time.

Make Payments Easier

So how can you ensure that you get paid on time? The answer is simple – make it as easy as possible for your customers to pay you. Here are 3 things that you can do to ensure this:

      1. Set up a simpler way to collect payments – Move away from methods that require a lot of admin work for you and your customer, such as cash or cheques. Using online payment gateways requires such as Curlec requires much less effort for your customer. This means that you can get paid quicker.
      2. Collect on a monthly basis – Collecting on a regular monthly basis means that your customers can spread their costs out evenly, rather than having to front up the money for quarterly or lump sum payments.
      3. Use online accounting software – Invoices and statements can be automatically generated and sent out via email. This saves you having to deal with stacks of papers and worrying about things getting lost in the post.

 

How Curlec Is A Smarter Way To Collect Payments

At Curlec, we understand the difficulties that businesses face when collecting payments and the impact of unpaid invoices. That is why we have created a simple and cost-effective solution that enables you to take Direct Debit payments online.

    • Gain control of when you get paid – Direct Debit puts you in control of when you get paid as your customers authorise you to collect payments when they are due. This means no more late payments.
    • Instant set up for customers – Customers can set up their Direct Debit with you within minutes and their bank details are filled in securely. Once this is done, payments become a seamless process.
    • Automate payment collection – Curlec can integrate with your accounting software so you can automatically set up payments alongside your invoicing.

Get Paid On Time, Every Time

With Curlec taking care of your payments, we remove the stress of managing you cash flow and unpaid invoices. You no longer need to keep chasing your customers for late payment and can have peace of mind that there will always be money in the bank.

Focus on growing your business and stop worrying about getting paid on time. You can leave that to us.

If you would like to find out more, please fill in the contact form below this page.

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Introducing Curlec

The Recurring Payment Solution for Malaysian Businesses.

We are proud to launch our new brand, Curlec. As some of our clients and partners will notice, this is a rebrand of our previous identity, MyDirectDebit. We have chosen to do this to inject fresh energy into our new product offering and company. We are a young, vibrant FinTech organisation that is ready and able to disrupt the status quo, and we wanted a brand to reflect this. We believe that Curlec does the job.

Our business is centered around Recurring Collections, and this is how the Curlec name was born.

We want Curlec to be used as a verb in a similar way to how words such as ‘Google’ or ‘Uber’ are used. Expect to hear a lot of ‘Curlec’ in 2018.

From a product development perspective, we are way ahead of our original plan. Please don’t hesitate to contact us if you would like to learn more. We have a significant growth strategy for the next few years for this extremely underserved payment mechanism in Malaysia, and as with all great software companies, we take the view that our job is never complete. Join us as we continuously improve and evolve our offering that will make the lives of businesses around Malaysia significantly easier.

We will be going through an Equity Crowdfunding exercise with PitchIn in the coming months so keep an eye out for this. We will make sure to keep you all updated.

So welcome to our journey to revolutionise Direct Debit in Malaysia and beyond.

Happy 2018 everyone – have a great year ahead.