Decide whether to process invoices or credit card payments. Read the pros and cons to know which one works best for your business.

Invoicing Vs. Credit Card Payments – Comparison Guide

When it comes to deciding on what to process between invoicing vs credit card payments, there are a lot of factors to consider. Each method has its pros and cons, and not every business is the same. But your business could rely on one or another. So which one should you choose? 

In this article, we will look at invoicing and credit card payments to see which one works best for your business. That way, you will know which method of payment to use.

What is Invoicing?

Invoicing is the process of sending a bill to a customer for goods or services that have been provided. An invoice usually contains the following information:

  • The date that the service was provided
  • A description of the service
  • The amount due
  • The due date
  • The name and address of the customer
  • The name and address of the business
  • The terms of payment

What are the Pros of Invoicing?

Invoicing has several advantages, including:

  • You can give your customers a grace period to pay their invoices. This is usually between 14 and 30 days. Having a grace period will ensure that your customers have ample time to make payments. 
  • It’s easy to keep track of what has been invoiced and what is still outstanding. With invoicing, you can avoid any confusion that can lead to missed payments and customer misunderstanding.
  • You can send reminders to customers who have not yet paid their invoices. A recurring invoicing system, for instance, will automatically send reminders to customers that owe you money. 
  • You can offer discounts for early payment. Entice customers into settling their accounts by giving them incentives for paying early.

What are the Cons of Invoicing?

There are also some disadvantages to invoicing, including:

  • Customers may forget to pay their invoices. Invoices sent via email can get buried in your customer’s inbox, resulting in them forgetting to pay you.
  • Customers may dispute the charges on their invoices. Manual invoicing, in particular, is prone to errors that can lead to customer misunderstanding.
  • You may have to chase after customers who don’t pay their invoices on time. One of the most frustrating things about invoicing is contacting customers and asking for payment.

Why Choose Invoicing Over Credit Card Payment?

If you want to give your customers a level of control over their billing payments, invoicing may be better. Invoicing makes it easy to track what has been paid and what is still outstanding. However, you may have to chase after customers who don’t pay on time. Fortunately, you can remedy that with recurring billing.

What is Credit Card Payment?

When you process a credit card payment, you are essentially borrowing money from a bank to pay for goods or services. The money is then repaid to the bank, with interest, over time. Credit card payments have several advantages and disadvantages, which we will explore in more detail below.

What are the Pros of Credit Card Payment?

The advantages of credit card payment include:

  • You can get your money quickly. With invoicing, you have to wait until the customer pays their invoice. You can get your money with credit card payments as soon as the transaction is processed.
  • You can avoid bounced checks. If a customer writes a check that bounces, you will be responsible for any fees associated with that.
  • You can offer rewards to customers who use their credit cards. This can be a great way to encourage customers to choose this payment method.

What are the Cons of Credit Card Payment?

There are also some disadvantages to credit card payments, including:

  • You will have to pay fees for processing credit card payments. These fees can vary depending on the type of card used and the purchase amount.
  • You may have to pay interest on the money you borrow from the bank.
  • You will have to provide your customers with their credit card information. This can be a security risk if that information is not properly protected.

Why Choose Credit Card Payment Over Invoicing?

Credit card payments make it easier to avoid bounced checks and get your money quickly. You will, however, have to pay fees for processing credit card payments. Nonetheless, credit card payment is the right mixture of security and speed, which is perfect if your business is growing.

Why Use ReliaBills?

Whether you’re looking to choose invoicing vs credit card payments, ReliaBills can help. Our billing and invoicing software can make sending invoices and processing credit card payments easier. At the same time, we can also track payments, manage your customers, and more!

ReliaBills is an all-in-one invoicing and payment processing platform that can help you create a comprehensive billing system. We offer several features that can save you time and money, such as the following:

  • Invoice creation: create awesome invoices that will help you get paid on time!
  • Recurring billing: automate your billing process to get paid without lifting a finger!
  • Online payments: accept online payments from your customers – it’s fast, easy, and secure!
  • Automated late payment reminders: Never deal with awkward collection calls again!
  • SMS notifications: stay on top of your payments with SMS notifications.
  • Customer Portal: keep track of your customers in one place.
  • Relevant reporting: track your payments and invoicing over time and get accurate and relevant reports for further analysis.
  • QuickBooks 2-Way Sync: keep your accounting software up-to-date without any manual effort!
  • And so much more: With ReliaBills, you have all of the features you need to create the ideal billing system for your business. 

If you want to access all of these features, you will need to upgrade your free plan to ReliaBills PLUS for $24.95 per month. Click here to learn more!
If you’re looking for a comprehensive invoicing and credit card payment processing solution, look no further than ReliaBills. To learn more about how ReliaBills can help you with invoicing or credit card payments, check out our website today.

Wrapping Up

There is no right or wrong answer when deciding between invoicing vs credit card payments. It all depends on your unique business needs. However, we hope that this article has given you some food for thought and helped you decide which payment method is right for you.

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