AP Automation Streamlines and Accelerates Payment Processing

AP Automation Streamlines and Accelerates Payment Processing

As businesses continually strive to become more efficient, automation in the accounts payable (AP) space is gaining traction. Here’s what business leaders are thinking about: Why tie up employees’ time and effort carrying out a manual process when technology can do the work in less time with greater accuracy?

Today’s AP technologies can integrate seamlessly with your accounting platform, digitizing your processes and allowing you to set up workflows according to your company’s unique needs and goals. Your business can benefit from your streamlined capabilities by achieving heightened efficiency, time and cost savings, and more.

In short, AP automation may help your business:

Increase productivity. A wide range of administrative tasks are involved in manual payment processing: receiving invoices, verifying each invoice’s accuracy against its corresponding purchase order, resolving discrepancies, prioritizing invoices by due date, coding each invoice, obtaining appropriate approvals, entering the invoice data, ensuring timely payments and recording details about every payment.

Now imagine having all these tasks built into AP technology that frees employees’ time to work instead on higher-value tasks. Productivity would have the potential to rise significantly, and employees may feel greater job satisfaction and pride as they make more meaningful contributions to the business.

Improve accuracy and timeliness. The potential for human error — typos, duplicate payments, overlooked discrepancies between orders and invoices, missed due dates — is real when invoices are being processed manually. In contrast, AP technology works methodically and consistently, comparing checks against their purchase orders, flagging errors for review and keeping payments on schedule.

Save money. In addition to saving money on labor and supply costs related to time-intensive manual tasks that no longer need to be performed, accelerated approval and payment processes may position your business to cash in on early payment discounts. When payments are made like clockwork, without the risk of late or missed payments, you can take advantage of those discounts and avoid incurring late payment fees.

Improve visibility. Tracking invoices, approvals and payment details for audits and other purposes can be time-consuming and frustrating if the information isn’t organized and stored electronically. AP technology speeds and simplifies data retrieval by providing centralized, accessible digital records of all transactions. This centralization enables approved individuals to access timely, detailed reporting, such as approval and payment status, at any time.

Make approvers’ jobs easier. In addition to the time involved for an AP employee to track down each approver to get their sign-off in a manual process, department heads may be interrupted from their workdays to check and sign invoices. Approvers can instead have digital invoices routed to their devices, so they can approve them anytime and anywhere, with a click of their mouse.

Strengthen supplier relationships. Consistently prompt, accurate payments let suppliers and vendors know they can rely on you. AP automation can help you accommodate their preferred payment methods, too, so that your company becomes known for being easy to do business with.

Fight fraud and ensure data security. When the Association for Financial Professionals (AFP) conducted its 20th annual Payments Fraud and Control Survey in January 2024, the results pointed to a 15% year-over-year spike in the incidence of payments fraud. Four out of five (80%) of the businesses surveyed reported they had experienced actual or attempted payments fraud in the previous year — the third-highest percentage in 15 years. The payment method most frequently compromised was checks, with 65% of respondents reporting check fraud.

It's not surprising paper checks continue to be a popular target: They can be easily stolen from mail receptacles and subsequently altered by fraudsters, who then cash them, take the money and run. An automated AP system uses digital payments rather than paper checks and encrypts sensitive information to further reduce the potential for fraud. Security features included in AP automated solutions can also help protect your business from business email compromise and other fraudulent schemes, as well as data breaches.

Scale. Businesses poised for growth should have a payment system in place that can easily scale to accommodate increasing AP activity. Otherwise, current workers may be overwhelmed by the amount of work, or it may become necessary to hire and train additional AP staff members, adding to bottom-line costs.

If you’d like to know more about AP automated payment solutions and how they might benefit your business, please feel free to call Dollar Bank’s treasury management experts at 1-855-282-3888 Monday - Friday, 8:30 AM - 5:00 PM EST.

This article is for general information purposes only and is not intended to provide legal, tax, accounting or financial advice. Any reliance on the information herein is solely and exclusively at your own risk and you are urged to do your own independent research. To the extent information herein references an outside resource or Internet site, Dollar Bank is not responsible for information, products or services obtained from outside sources and Dollar Bank will not be liable for any damages that may result from your access to outside resources. As always, please consult your own counsel, accountant, or other advisor regarding your specific situation.