Managing school fee payments at your school
For independent schools, the school fees paid by parents are an important portion of your cashflow and enable your ongoing payments, including wages and materials. Unfortunately, some parents are not prompt at payment, which can send your cashflow in the wrong direction. Here are some tips to make sure that you receive payments.
Enable financing or part payments
If you have parents who do not have the upfront means to pay for their school fees, it can be useful to give the parents some options to make the payments easier. This can include making term-by-term payments or financing options where the parents can use a low-interest rate to make weekly or fortnightly automatic payments (similarly to furniture or car purchases). This can help parents who are able to pay over time but who may struggle with a large upfront payment.
Have an open door policy
Encourage parents who are having financial difficulties to come and have a chat at the office. You may be able to offer their child reduced fees or a partial scholarship or work out ways that the parents can reduce fees by spending some time working for the school in some capacity that suits their skills. By learning about any payment difficulties and making payment arrangements early on, you can stop the parent accumulating large debts that they can struggle to pay off.
Make use of debt collectors
If you have some bad debtors that have not made arrangements with the school to start paying off their debts, you should involve a debt collection agency to start the process of getting the debt paid. Often a sternly worded letter from a debt collection agency can prompt disorganised parents into suddenly making payments or getting in contact to organise alternative payment options. If the sternly worded letter does not have the desired effect, debt collection agencies can use their experience and dedicated time for retrieving payments from the parents. This can leave the school administration free to concentrate on the important work of running the school.
In order to keep your school running as efficiently as possible, it's important to have processes and policies in place to deal with prompt payment of school fees, and any subsequent bad debtors. Gaining some professional help from a debt collection agency can be a useful resource, especially for school administrators who are often not experienced in chasing down bad debts.