Q: We experience extensive lost staff productivity and customer dissatisfaction due to awaiting refunds from non-credit card transactions. Due to this, I'm strongly considering a credit card or P.O. only policy. I'd appreciate your team's thoughts on pros/cons and an understanding of what other programs deem important elements of their success with regard to payment policies. This is particularly important as we're setting up our Lumens policies and determining what is required to dual-enter in Banner.
A: LERN does recommend that you allow for a variety of payment options. Of course, as more and more of your registrations go online, you will see an increasing percentage of your payments done by credit card. Paypal and credit cards are the two most common online payment options. My guess is that most people are likely to use credit or debit cards, anyway, because it is simply the most convenient way to pay. I would think you might look at the percentage of people who use other options. My guess is that it is small.
If you are selling your courses to people who are part of a larger organization, such as a college or university or business, and the institution is paying, the participant may be required to have a purchase order. This is not ideal, either, since a p.o., does not insure payment. . .only the intent to pay, and often there are receivables that you must chase. I would think that a p.o. would also require a manually processed refund, and that this would also be slower than a credit card refund.
You might consider an option of allowing people to use Paypal. This is beginning to be an option in retail stores, and could address concerns of people who do not want to use credit or debit cards. Since the payment is (or can be) drawn directly from the person’s bank account, there is no credit issue, similar to a debit card transaction.
Regarding the issue of customer satisfaction, I would recommend that in your refund policy statement you state clearly that refund processing takes longer for those who do not pay with credit cards, since the refund transaction is more complicated. This is a choice people can make, but need to understand that it can affect the speed of their refund. In addition, even though your staff can quickly process the credit card refund, it may take at least a billing cycle before the credit is posted to the credit card account. The perception is that the refund is quicker, but it is more likely that only the process is quicker.
When people get a credit card refund, they walk out with a receipt saying that a refund has been processed. You could do this with people who pay by other methods. It will be a while before the check for the refund shows up in the mail, but they will have a document in their hand that says they have received a refund. This might address the customer satisfaction issues.
Regarding the staff productivity issue, you might want to explore just how often a refund for a non-credit card transaction occurs. Your program should not be receiving substantial numbers of refund requests. If you are, this is usually an indication that you need to look internally at other policies, processes, and quality issues. Processing a manual refund does take more time, but this is not something you should be having to do often in large numbers.
Overall, keep your eye on the ultimate goal of your program—to provide the most people possible with the best experience possible, with the most convenience possible. To do this, you need to provide choice and options to prospective participants which would mean that you need to continue to offer a variety of payment options to your customers.