Payment plans sound great—until customers ghost after the first installment. Here's how to design plans that actually close 90%+ of the time.
Why Most Payment Plans Fail
Common Failure Patterns:
- Too flexible ("Pay when you can")
- No automation (manual follow-ups)
- No card-on-file
- Too many installments
- Vague due dates
The 3-Part Formula for Successful Plans
1. Clear Structure
Bad: "Pay when you can"
Good: "$500 now, $500 in 30 days, $500 in 60 days"
Why it works: Specificity removes ambiguity and creates commitment.
2. Automation
- Auto-schedule SMS reminders for each installment
- Include payment link in every message
- No manual tracking needed
Why it works: You can't forget to follow up, and neither can they.
3. Card-on-File Option
Let customers authorize future charges upfront. Removes risk of ghosting.
Why it works: Card-on-file converts payment plans into automatic recurring billing.
Real Case Study: Consultant Offering $4K Project
Old Way (Failed):
- Client paid $1K upfront
- Ghosted on remaining balance
- Result: Lost $3K
New Way (Success):
- $1.5K upfront (37.5%)
- $1.25K at 30 days (auto-scheduled)
- $1.25K at 60 days (auto-scheduled)
- Card authorized at start
- Result: 100% collection
Payment Plan Best Practices
Keep Installments to 3 or Less
Every additional installment adds 15% risk of non-completion. Three installments max keeps completion rates above 90%.
Front-Load the Payments
Take 40-50% upfront. It proves commitment and covers your hard costs.
Set Specific Dates, Not Ranges
Bad: "Pay by end of month"
Good: "Pay by March 15"
Send Reminders 3 Days Before Due Date
Automated SMS reminders 3 days before each installment reduce late payments by 68%.
Include Terms in Writing
Send a confirmation SMS with the payment plan terms:
"Here's your payment plan: $500 now (done!), $500 on March 15, $500 on April 15. Links will be sent automatically."
When to Offer Payment Plans
- High-ticket services ($1000+): Makes pricing more accessible
- Customers who ask: If they're willing to commit to a plan, say yes
- Recurring clients: Build trust for bigger future projects
When NOT to Offer Payment Plans
- New customers with no track record: Risk is too high
- Small invoices ($500 or less): Not worth the admin overhead
- Customers with past late payments: Patterns repeat
Add Recurring Billing Module to AutoPayAgent
Set payment plans once, get paid automatically. No manual follow-ups.
Enable Recurring Billing