Organizations are under immense pressure to do more with less in today's economy. After relying on traditional business processes and legacy systems for years, they're now having to step out of their comfort zones in search of ways to enhance operations and cut costs. Digital payment technology has emerged as a viable approach to improve and streamline back-office functions such as AP (accounts payable) and AR (accounts receivable), eliminating costly bottlenecks.
Companies are taking a closer look at their processes and working capital to identify where they can make effective changes. Even though traditional business operations and legacy systems have been used for years, modern digital payment technology can offer better results and a better bottom line. Roughly 81 percent of businesses still use paper checks to pay other businesses, and, unfortunately, they can take up to 15 days to clear. Therefore, many companies are looking to shift to digital solutions to streamline payments, cut processing costs and speed up cash flow.
Streamlining workflows and improving data management and visibility are just a few ways digital payment technology can help your bottom line. Here are some benefits of how digitizing AP and AR can impact a company's finances.
- Streamline workflows: Disjointed workflows can cause bottlenecks in business operations. Implementing and integrating digital payment technology into ERP (enterprise resource planning) and CRM (customer relationship management) software can help organizations better manage business operations and automate back-office functions. These integrations offer a seamless flow of information between systems, saving employees time, reducing data entry errors and increasing revenue.
- Enhance efficiency and productivity: Manual outbound payments to vendors and suppliers can be time-consuming, costly and error-prone. By bringing electronic payment solutions into the mix, businesses can improve efficiency by reducing errors. This saves time on vendor management and reduces the human intervention required to process payments. With improved efficiency and productivity, organizations cut back on labor costs while reallocating employees to other business areas.
- Reduce payment processing costs: Paper checks and manual processes can lead to late payments and high processing fees. Digitizing outbound payments eliminates costs from printing and mailing the checks, including labor and postage. However, payment technology helps companies avoid late payment charges and reduce processing fees and administrative costs.
- Mitigate fraud risk: Relying on manual payments and check writing makes companies vulnerable to fraud. Electronic payment methods, such as virtual cards, offer companies a safer, more secure alternative to further protect assets through amount limits and expiration dates.
- Speed up payment processing: Automating and integrating payment solutions into AP and AR workflows help speed up payment processes, accelerating cash flow and allowing for better monitoring with less manual effort.
- Enable better visibility: Electronic payment technology enables systems to integrate easily with one another to support a more comprehensive business management platform. By eliminating the need for separate reporting and reconciliation, companies gain better visibility into AP and AR, which leads to more effective cash management. This can also improve financial and strategic decision-making.
- Allow for vendor rebates: Virtual card payments don't just eliminate check processing costs — they also generate revenue from cash rebates which can be reinvested in the business.
Payment Technology That Makes Sense
Digital payment technology offers several benefits for companies. From improved cash flow and revenue to reduced fees and costs, today's technology has the potential to improve your bottom line. Whether you're interested in accepting customer payments or making payments to vendors, REPAY offers several solutions to empower your business.
Contact us today to learn more about REPAY and how our solutions can integrate with your current systems.