Not only is managing tasks such as data entry and document matching using manual processes slower and more error-prone, those processes tend to be repetitive and tedious for employees. That can lead to higher rates of burnout, a major concern for any business in an era of widespread worker shortages. Automation frees up those workers to focus on more engaging tasks that make better use of their skills and training. A system that automates the use of wire transfers, virtual cards, and other regular financial transactions makes it simpler to match interfaces with your B2B partners. That allows you to keep a standard enterprise resource planning (ERP) system and combine payments for even bigger savings. Not only does this help AP team members operate more efficiently, it also gives them the time and energy to focus on more strategic activities that can scale the business.
B2B Payments Explained
- Even smaller companies faced a coin flip’s chance of confronting check fraud, with 52% reporting attempted or actual incidents.
- If you haven’t already noticed, payments automation has come a long way recently.
- Automated processes are faster, more efficient and more cost-optimal, leading to an ROI in both the short and long term.
- Also known as dynamic discounting, this can save your business money just for paying on time.
- With slow, fraud-prone payments such as paper checks costing firms heavily and placing a drag on their cash flow, many are seeking solutions.
- If you plan to introduce a payments automation solution, you will want to give stakeholders a solid value proposition in order to get them on board with your spend proposal.
- Automation also provides real-time insights into receivables, predictive analytics to forecast cash flow and detailed reports that support strategic decision-making.
Wire transfers are a secure way to send money directly from one bank account to another. Unlike direct debits, b2b payment automation which are set up to automatically withdraw funds regularly, wire transfers are typically one-time payments for specific transactions, especially in international transactions. While widely accepted, they tend to have higher fees and take longer to process.
How does AP software handle tax compliance?
Getting vendors to accept virtual card payments is a beneficial first step when you choose an automated payment processing solution. This changeover can lower your staff’s payment processing time as well as increase your business’s eligibility for cash rebates. Accounts payable (AP) automation refers to using technology to streamline and automate the processes of managing a company’s incoming invoices and outgoing payments.
The Best AP Automation NetSuite Add-Ons
Easily extend and simplify your workflows with Food Truck Accounting pre-built integrations and powerful APIs for your ERPs, accounting systems, performance marketing platforms, HRIS, SSO, Slack, credit cards, and more. The threat of fraud in accounts payable (AP) has been a persistent and growing issue for businesses, and it doesn’t appear to be improving. Maximize accounts payable efficiency and minimize risks with our in-depth article. A faster reconciliation process frees up your finance team to focus on strategic initiatives rather than getting bogged down in day-to-day transaction matching.
Reduce check use by switching to ACH transfers
This reliable payment history can open doors to negotiating better terms with suppliers and vendors. Many suppliers offer early payment discounts, which become more accessible with efficient payment automation. These discounts can lead to substantial savings over time and meaningfully impact the bottom line.
Why automate accounts payable?
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THE BENEFITS OF PAYMENT AUTOMATION
However, they are slower to process, often require human intervention, and are more susceptible to fraud compared to electronic methods. The evolution of B2B payments automation is a pivotal force that’s reshaping the landscape of business transactions. This advancement has not only streamlined traditional paper processes, it bolsters security measures, enhances supplier relationships, mitigates risks, and saves a business money. Adopting digital payment solutions can also lead recording transactions to cost savings through both increased efficiency and, importantly, better fraud prevention.
Solutions
It’s time to invest in your company’s bottom line by improving the productivity of your AP team and your suppliers’ AR teams. Ultimately, you get more accurate and comprehensive data that you can use to track your expenses and improve cash flow forecasting. Demand for APIs in AP processes has increased — especially since you can use them to share data and facilitate online payments. Further, the study also noted that smaller businesses—which routinely have fewer anti-fraud measures in place—were four times more likely to fall victim to this method than their larger counterparts. The accounting profession is facing a significant shortage of skilled professionals, forcing teams to do more with fewer resources. This talent gap can lead to increased workloads for existing staff and subsequent delays in financial reporting.
Some automation software companies will try to sell you on the idea that they offer full procure-to-pay (P2P) capabilities—when really—their solutions are only good at automating a few AP functions. That’s why understanding your business’s pain points and knowing what makes up AP best practices will help you find a B2B payment automation solution ideal for your business. Maybe payment automation is a new idea, and your AP team is currently manually reconciling check payments via phone call. Or maybe you’re considering different options and want to make sure that you’re approaching your digital transformation the right way. Lastly, you might already have partially or fully automated your B2B vendor payments and are just looking for ways to improve the process further. Best-in-class solutions also provide comprehensive supplier enrollment support to accelerate the migration to digital payment methods like virtual credit cards and ACH transactions.
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