The Prorated Contracts feature simplifies the enrollment process by automatically adjusting calculating the initial payment from the "Contract Start Date" to the next "Payment Due Day."This guarantees precise billing, ensuring members are charged only for the days they are actively enrolledfor a membership contract.
For example, if a member enrolls on the 15th of the month, and their payment due day is the 10th of every month, their initial payment is automatically prorated to cover the 15th through the 10th of the following month.
By calculating initial payments based on the precise enrollment date, this feature ensures members are billed accurately.
Configuring Monthly Proration on Contracts
Configuring your monthly prorated contracts is straightforward. Follow these steps:
Navigate to Setup > Inventory > Packages.
Next, edit an existing contract or create a new contract by clicking the Add Contract button. (Click here for more details on creating a new contract.)
Note: Monthly proration only applies to contracts, not packages.
To configure proration, head to the Renewal Details section, where proration settings are managed. Keep in mind the following requirements when configuring proration:
Contract Type: Must be set to "Term" or "Ongoing".
Payment Frequency: Must be set to "month(s)".
Prorate First Month: Ensure this checkbox is checked.
Payment Due Day: This number refers to the day in the month that payment is due, and therefore must be set to a value other than zero. For example, enter 1 for accounts that bill on the 1st of the month, 10 for accounts that bill on the 10th of the month, and so on. Member Manager will set up the contract with the prorated amount between to cover the time from “Contract Start Date” and to the next “Payment Due Day”. This amount will be shown under “Due Today” and will include any initiation fees or down payments entered.
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If an initiation fee and down payment are set, the payment schedule will display a pre-payment that includes the prorated amount, the down payment, and the initiation fee. For example, if a contract is configured for 24 payments, the schedule will show a pre-payment that combines these amounts, followed by 24 additional payments.
Note: If you want the pre-payment to count as one of the 24 payments, set the "Number of Payments" to 23 and recalculate the payment schedule using Save & Update Payment Schedule.
In the example below, using the contract details above (contract is prorated, $10 initiation fee, $10 down payment set to "Apply to All"), starting on 7/19 with the payment due on the 1st, the pre-payment amount is broken down as follows:
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Members can click “Join Now” and proceed through purchasing the contract. Click here for an overview of the Member Portal and details on purchasing contracts.