A flip on a COVID theme: Digital payments become physical

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Jolted by the pandemic into accepting online payments after decades of relying on paper checks, small and midsize accounting and law firms are now moving back toward accepting payments in the office again. But it's far different from how they did business before 2020.

AffiniPay, a 20-year-old Austin, Texas-based fintech that has long provided online payment acceptance and software for small law and accounting firms, this month announced a range of tools enabling professional services firms to accept card payments in person. 

The trigger came when a significant number of these firms recently expressed a desire for flexible terminals or tap-on-phone options to accept payments in person, said Dru Armstrong, AffiniPay's chief executive officer.

"Over a third of our customers are interested in having in-person payment options because their clients are coming back into the office and it's easier to collect payments on the spot," she said.

To further streamline operations for AffiniPay's 84,000 legal and accounting firm customers, the company on Wednesday unveiled plans to add a range of internal spend-management tools and credit financing options through a partnership with digital card-issuing firm Marqeta.

Oakland, California-based Marqeta will power the launch of MyCase Smart Spend, a virtual Visa credit card embedded within AffiniPay's existing MyCase platform for law firms to manage company expenses with revolving Visa credit cards co-branded with AffiniPay, according to a press release.

The moves underscore how pandemic-forced leaps in digital payments technology continue to spark changes at all types of businesses, including small firms that traditionally relied on manual billing processes and paper checks, said Thad Peterson, a strategic advisor at Datos Insights.

"While COVID pushed people away from physical commerce, it's come back with a vengeance, due to the recovering economy and a desire by people to connect in person," he said.

In addition, widespread adoption of digital consumer payments has helped to awaken even the smallest professional services firm to the advantages of modernizing payment acceptance, according to Peterson.

"Having a digital payment acceptance offering that's exclusively used online can limit the value of the approach for clients, and since it's inevitable that people will show up to pay for stuff, a physical acceptance tool is essential," he said.

Tap-on-phone and other wireless contactless payment options are also likely to find users among many other types of small businesses with occasional walk-in customers, he said. 

"Especially for [smaller] firms, a tap-on-phone or contactless payment option eliminates the need to acquire or manage a total POS hardware solution, and it can be used on an 'as needed' basis," Peterson said.

AffiniPay for years has provided an online payment acceptance option for thousands of firms. The firm got its start by enabling nonprofit professional associations to accept payment for membership dues, then branched into helping solo and small law firms accept online payments for routine business. About five years ago, AffiniPay extended similar services to small accounting firms.

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Netherlands-based payments services provider Adyen powers the new in-person payment options for AffiniPay. The new in-person payments options include a small, wireless device that a professional services firm would use to accept contactless payments in the office or at on-the-go meetings; a terminal with a larger screen that attaches to a computer and displays more details; and a mobile phone app with contactless acceptance.

AffiniPay estimates the average size of an in-office payment for its law firm and accounting firm customers is about $1,100, and accepting payments on the spot significantly speeds up firms' financial cycles. 

"There's still a fear among a lot of small firms that it's going to cost them more time and money to change, but as payments have gone digital they're realizing it's overall a huge benefit to have people pay in the office at the time of service, instead of mailing an invoice or having customers read their card numbers over the phone later," Armstrong said.

AffiniPay charges firms $20 a month for basic card acceptance, plus a standard card merchant processing fee of between 2% and 3% per transaction, depending on the card, she said. For firms adding in-person acceptance, the smallest wireless terminal will have a one-time cost of about $100, and the larger terminal will be about $200, with tap-on-phone included within LawPay.

AffiniPay, which also provides professional services firms with a range of practice management software and other cloud-based services, plans to expand its new payment services to other verticals including CPACharge, ClientPay and AffiniPay for Associations.

Launched in 2005, AffiniPay is now working to combine its core payments and practice management software with digital invoicing and employee timesheet management, Armstrong said.