Non Refundable Payment Agreement: Everything You Need to Know
Having a non-refundable payment agreement in your terms and conditions is essential if your business sells a product or service. 3 min read
2. Payment Terms in Terms & Conditions
3. Payment Terms for SaaS Apps
4. Payment Terms for One-Time Payments
5. Non-Refundable Deposit Agreement
6. Party Specification
7. Purchase Specification
Non-Refundable Payment Agreement
Having a non-refundable payment agreement in your terms and conditions is essential if your business sells a product or service. Depending on the nature of your product, your refund policy can have a major impact on how much money your business generates. For digital products, for instance, a non-refundable payment agreement can be useful since there is no physical product to return.
Payment Terms in Terms & Conditions
You can include certain clauses in your terms and conditions agreement regarding your payment terms if your business accepts payments via your website or mobile app. This clause is helpful in all forms of business, whether you collect your payments on a monthly or yearly basis, or on a per-purchase basis.
Having payment terms also helps protect your business while informing your customers of the expectations you have regarding how payments are handled.
Some of the most common information found in these clauses includes:
- How customers pay, such as credit cards or purchase orders
- How any late or missed payments are dealt with
- All return and refund information
- How any disputes will be handled
Your clauses for one-time payments and recurring payments are going to differ, but they both need to explain the following to customers:
- What customers can purchase
- How they can make a purchase
- Whether or not refunds or returns are allowed
- What happens when the payment is not made
- Any additional information the customer needs to be clear on the payment terms
Payment Terms for SaaS Apps
If your SaaS apps let customers buy subscriptions or pay regular fees, you need to be sure to add a clause in your agreement that talks about your right to suspend service or cancel the account altogether, and the reasons why you would need to do so.
You also need to add a clause for how renewals will occur, such as automatic renewal unless the customer cancels or if there are specific steps that have to be taken for a renewal. Additionally, you need to have a clause stating how subscription plans work and how often the customer is billed for your services.
Payment Terms for One-Time Payments
A normal business or mobile app typically allows customers to make a one-time purchase. For instance, sale of a shirt, hotel reservation, or buying an app that is not subscription-based are considered one-time purchases.
You may want to include a clause for these payments, including the type of payments you will take, what the customer is actually buying, whether or not you allow returns, and any other rights you want to retain so to limit your liability.
Non-Refundable Deposit Agreement
A non-refundable deposit agreement is a form of contract that buyers and sellers sign regarding the sale of an asset. The asset type can vary, but it is typically something the buyer will need to purchase on credit or after a significant sum of money has been raised.
There will be a delay involved since it takes time to secure a large sum of money. The buyer will want assurance that the sale will move forward despite the delay. A deposit agreement is the best solution, as it meets the needs of everyone involved.
A non-refundable deposit agreement will begin with party specification. This identifies who is buying and who is selling. The buyer is identified by name and will include an address for communication purposes. The seller is a business or an agent of the business. It makes sure that the deal that is offered will not be given to another buyer or that the deposit will be provided to a different business.
An agreement will directly address the purchase. It will also identify the deposit, which is often a percentage of the cost of the product or service. It also will state what item the deposit is securing. It could range from a vehicle to a set of office furniture.
The buyer will want to ensure that it is the exact item or service he or she wants rather than something similar. The model number of a physical item will also be noted.
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