Daycare Payment Policy Guide: Best Practices and Sample Template

A strong, clearly written daycare payment policy is essential for ensuring timely tuition collection, maintaining trust with families, and securing your program’s financial health.

This article will walk you through the key components, best practices, and even provide a sample template to help you craft a policy that supports your childcare business.

Why you need a daycare payment policy

Running a daycare or childcare program involves more than nurturing young minds—it also means managing finances responsibly. A well-crafted daycare payment policy ensures that:

• Families clearly understand tuition expectations
• Payments are made on time
• Your staff and operational costs are reliably covered

By defining payment terms up front, you create transparency and reduce the risk of disputes, confusion, or late payments.

The key elements of a daycare payment policy

A daycare payment policy covers several essential aspects to ensure clarity and fairness for your program and the families you serve. Some key components to include in your payment policy are:

Tuition and fees

• Break down tuition by age group or program
• Clarify whether tuition is charged weekly, monthly, or per session
• Include registration, supply, and miscellaneous fees

Accepted payment methods

• List options: cash, checks, credit/debit cards, online payments, mobile apps
• Highlight online systems like brightwheel, which simplify and automate billing

Billing schedule and due dates

• Define when tuition invoices are sent and when payments are due
• Example: "Tuition is due each Friday for the following week"
• Brightwheel's invoicing feature can automate all your invoicing tasks, including generating invoices for recurring billing plans, sending payment reminders, and tracking invoice status
  

Late payment policy

• Set expectations for grace periods and late fees
• Discuss your late payment policy at new family orientation and get signed acknowledgment

Refunds and closures

• Explain your policy on refunds during holidays, closures, or withdrawals

Discounts

• Include multi-child, referral, or prepayment discounts if offered

Daycare late payment policy: Set expectations early 

It’s no surprise that your families are busy and therefore, you may face situations where payments are late or missed. For these types of scenarios, it’s important to prioritize and communicate your program's policy regarding late payments. Having a clear policy is crucial for the financial stability of your program. Outline this policy in your family handbook, including information on due dates, the grace period (if any), late fees, and any other consequences for continued late payments. 

Consider discussing this policy with families in-person during your orientation and having them sign an acknowledgement to avoid any misinterpretations. By addressing late payments in advance, you can prevent financial difficulties and ensure that staff and operational expenses are paid on time.

Establishing a clear late payment policy helps:

• Maintain steady cash flow
• Avoid awkward conversations
• Promote fairness across all families

Best practices:

• State the exact due date and fee structure
• Communicate expectations during enrollment
• Follow up consistently on late payments

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How to create or update your payment policy

A lot of effort goes into creating or updating a daycare payment policy. As you build out or edit your policy, here are several factors to consider to make it effective and fair:

Offer flexible payment options

Some families may face financial challenges, so consider offering payment plans or flexible payment options to accommodate their needs. It's also important to make it easy for families to pay their tuition and obtain receipts for their payments. With brightwheel, families get receipts instantly after payment, saving you time and improving your payment experience.

Include financial assistance program info

Childcare costs can be overwhelming for families. To help with this burden, states and territories may assist low-income families financially. Be sure to include details in your payment policy if your program accepts these vouchers, certificates, or subsidies.

Communicate clearly and often

Ensure that families are well-informed about the payment policy from the start. Provide a written copy, discuss it during orientation, and be open to answering any questions.

Consistently enforce your policy

Fair and consistent enforcement of your payment policy is essential for maintaining the credibility of your program. Avoid making exceptions that could lead to misunderstandings or resentment. Train your staff on the policy so they know how to confidently enforce it.

Stay legally compliant

Familiarize yourself with local regulations and laws related to daycare payment practices to ensure compliance and prevent legal issues.

Childcare Tuition Contract Template

Download a free childcare tuition contract template to save you time.

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Best practices for enforcing your daycare payment policy

To streamline the payment process and enforce your payment policy effectively, consider the following best practices:

• Use technology or childcare management software: Incorporating technology into your childcare billing process helps create a stress-free back office and contributes to future financial success. Payment processing software and billing solutions help improve invoicing and allow for electronic payments. For example, brightwheel's childcare billing software can automate invoicing, track payments, and send payment reminders to families. It can also be beneficial when billing multiple payers individually for childcare services. Overall, childcare management software is a valuable addition to your operations because it helps save time, increases on-time payments from families, and enhances the tracking and reporting of your program's finances. 
• Establish open and regular communication with families: Maintain an open line of communication with families regarding payments. Late or unpaid invoices can negatively impact your business, so regularly communicating payment due dates to families is key. Creating a payment reminder schedule can help address payment issues proactively and professionally to ensure understanding and resolve any problems.
• Educate your staff on your policy and their role in enforcing it: Ensure that all staff members are well-versed in your payment policy and understand their role in enforcing it. This includes front desk staff, teachers, and administrators.
• Update your policy annually: Set a recurring annual review of your payment policy to ensure it remains effective, compliant, and aligned with your program's evolving needs. Use this time to analyze any payment-related challenges over the past year, incorporate updates from local regulations, and gather direct feedback from families to identify areas of confusion or improvement. Regular updates demonstrate your commitment to transparency and continual improvement.
• Keep records: Maintain detailed and organized records of all tuition invoices, payment receipts, and communication with families regarding billing. Use digital tools or childcare management software like brightwheel to automate and securely store these documents. Keeping accurate records not only ensures financial transparency and simplifies tax preparation but also provides critical documentation in case of disputes or regulatory audits.

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Daycare payment policy template

Creating a daycare payment policy template requires careful consideration to ensure that it effectively communicates important information to families and maintains a positive and professional tone. Be sure to include clear and concise details on payment due dates, tuition, additional fees, payment methods, fee schedules, and more. Below is a sample payment policy template you can refer to when creating your program's policy.

Daycare Payment Policy - [Your Program Name]

We are committed to providing your child with a safe and nurturing learning environment. Paying tuition on time helps us retain our highly qualified teachers and pay our bills on time. All payments are due prior to care. Tuition reminders are sent via email [frequency] and payment is due by [specify day]. 

Billing information can be viewed at any time via the brightwheel app. Statements cover the following week's child care. All tuition and fee payments are non-refundable. We have developed the following payment policy to ensure a smooth and transparent payment process. ​Please take a moment to read and understand the terms outlined below.

• Payment schedule:
  • Tuition fees are due on [specify due date] each [week/month].
  • The payment schedule will be provided upon enrollment and may vary based on the selected program.

• Payment methods:
  • We accept payments in cash, check, or online via the brightwheel app.
  • Please make checks payable to [Program Name].

• Fee structure:
  • Tuition fees cover regular daycare hours and activities.
  • Additional fees for specialized programs, field trips, meals, or extended hours may apply. These fees will be communicated separately.

• Discounts and incentives:
  • [Program Name] offers the following discounts and incentives:
    • Families with more than one child enrolled full-time receive [discount percentage] off of the youngest child’s tuition.
    • [Amount or percentage off] for referrals.
• Late payments and penalties:
  • Tuition is due before "close of business" on the [specify day] before the week of care.
  • A late fee of [amount or percentage] will be charged for payments received after the due date.
  • Late fees will be applied to your next billing cycle.

• Non-payment and termination:
  • In the event of persistent late payments, [Program Name] reserves the right to suspend or terminate your child's enrollment.
  • [Number of days] notice will be provided before termination due to non-payment.

• Privacy and security:
  • All payment information provided will be treated with the utmost confidentiality and in compliance with data protection laws.

• Communication:
  • For payment-related inquiries or concerns, please contact our billing department at [billing department contact details].

• Parental agreement:
  • By enrolling your child in [Program Name], you acknowledge that you have read, understood, and agree to comply with the payment policy.

We believe clear communication is vital for maintaining a strong partnership with families. If you have any questions or require further clarification, do not hesitate to reach out to us. We value your trust and support as we strive to create a caring and stimulating environment for your child.

Final thoughts: Protect your business with a clear policy

A detailed, transparent daycare payment policy gives families confidence and helps you run a financially sustainable business. A thorough policy will go beyond simply outlining payment terms and fees and will incorporate your accepted payment methods, fee structure, consequences for late payments, and any discount opportunities. 

Whether you’re just starting or revising your policy, this guide and template will help you stay organized, compliant, and focused on what matters most—delivering quality care.

Brightwheel is the complete solution for early education providers, enabling you to streamline your center’s operations and build a stand-out reputation. Brightwheel connects the most critical aspects of running your center—including sign in and out, parent communications, tuition billing, and licensing and compliance—in one easy-to-use tool, along with providing best-in-class customer support and coaching. Brightwheel is trusted by thousands of early education centers and millions of parents. Learn more at mybrightwheel.com.