Doula Fees: How to Get Paid for Services

How are you being paid for your services?  Doulas have been compensated in many ways ranging from barter to insurance payments.  The most common way to be paid for years has been cash and check, but payment options are growing.   In this blog post I’ll look at advantages and disadvantage of three of the most common payment options available.  {Note insurance coverage is not covered in this post as it deserves its own blog}

Cash and Check

Cash and check have long been the typical way that doulas are paid.  Have you ever found yourself with a stack of deposit checks sitting on your desk waiting to go to the bank?  Many doulas are still collecting payment via check, oftentimes asking clients to mail a deposit check or send a check to complete their payments.

Advantages

Getting paid by cash or check is the most lucrative way to be paid.  There are no fees associated with these traditional forms of payments.   For many doulas, checks are an easy way to collect payment.  There is no learning curve to getting paid by cash or check. 

Disadvantages

Cash and check isn’t easy for many of our millennial customers.  They aren’t used to paying for bills by check.  According to First Data Corporation, more than one fifth of all millennials haven’t paid a bill by writing a physical check.  Millennials are active online banking users.  Asking our customers to pay by check might cause making a payment a chore.  By requiring this method of payment, doulas could appear old fashioned and possibly even unprofessional.  We certainly don’t want our request for a check to delay our payment!

PayPal

PayPal is a payment option that is gaining in popularity among doulas.  You might find that most of your doula clients have a PayPal account and use this form of payment regularly when they buy items online or sell items on popular sites like eBay.  PayPal accounts are linked to a bank account and in order to get access to the funds the account holder has to transfer/withdrawn the funds from their PayPal account to their bank account.  This process usually takes 3-5 days, but can vary depending upon your country.

Advantages

PayPal is a popular way for paying for products and services online.   The payment site has tools to help businesses accept payments easily.  The PayPal account user can quickly create an invoice using the free templates and email clients through the PayPal site.  There is also a fun feature called PayPal.me where account holders can create a personal link that makes payment super simple.  I created one for my own business that you can see here http://paypal.me/alicethedoula.   There is also a very easy to use tool that you can use to add a payment button to your website.  This button can be customized in so many ways including adding a price and changing the size of the button.  This could be an option for collecting payment directly through your website.  Here is a button that I created in less than one minute.  It is for a 1 cent payment which goes directly to my PayPal page.  (if you find this blog post useful you can press the buy now button and send me a one US cent!) 

 

Disadvantages

When you hear complaints about PayPal they nearly always seem to be about their fees. PayPal charges the seller/service provider 2.9% of the amount paid and an additional 30 cents per transaction. This means is that if you charge $1000 for doula services, $29.30 will be held by PayPal for their fee.

Please take note that it is against the PayPal user agreement to request that your buyer use the “send money to a friend or family member” when they are paying you for services that you have provided. I researched this topic and contacted PayPal directly. The customer service representative confirmed that this is not the correct why to get paid for services using PayPal. You can find all of the details about this part of the user agreement here. Quoting PayPal “You may not use the ‘send money to a friend or family member’ feature in your PayPal account when you are paying for goods and services.” Violating the PayPal user agreement can put you and your buyer at risk for their account being shut down.

Online Payments

There are countless companies that provide a method for accepting online payments. Well known options include Square and Stripe which are the two that I researched for this blog post. Stripe fees are the same as PayPal which is 2.9% of the sales amount and 30 cents per transaction. Square fees are a bit less when you swipe a card than both Stripe and PayPal at 2.75% of the sales amount. If you type in the card number (through your website for example) the fee at Square is a bit higher at 3.5% and a 15 cent per transaction fee.

Advantages

Both Square and Stripe have mobile apps and allow you to easily swipe credit cards on your phone. In addition, adding a payment buttons to your website is almost as easy as adding a PayPal button. I created one below that links to my Stripe account. (feel free to test and send me another penny!) I think an advantage that Stripe has over PayPal is that customers aren’t required to have a PayPal account in order to make a payment. They can pay with debit/credit cards which could include debit cards that are setup for a healthcare flexible spending account.

 

 

Disadvantages

The fee is the biggest disadvantage of accepting online payments. Just like PayPal, the service provider is charged a fee for the convenience and protection of online payments.

What’s Next

The world of electronic payments seems to be changing daily. There are a few options in the future that look promising like Google Wallet and Venmo for Business. Until these become a bit easier to use and setup for business account, I think the best option is to look at adding PayPal and either Stripe, Square or a similar online payment processor to your business payment options. Moving beyond the typical cash and check payments will allow your clients to have options that are comfortable to them. The fees might be painful at first, but I think the advantages outweigh the fees. When it comes to tax time, there is a good chance that these fees can be categorized as business expenses. (perhaps this is the silver lining!)