The challenges of managing a finance department remotely has many people wondering: Why don’t more organizations switch to secure electronic payments?
The answer: Long-held myths, misconceptions and perceived barriers regarding commercial accounts payable (AP) processes and lack of awareness of advances in integrated payables (IP).
Buyers and suppliers are locked in a cycle of expensive, inefficient manual payments, despite the emergence of new technology and specialized expertise that can simplify and integrate commercial payments. Even those using electronic accounts payable (EAP) and AP automation are still missing out on a payments engine and the value of an effective IP strategy that delivers seamless execution and early payment discounts, cash-back rebates and incentives.
Three of the most common misconceptions may be preventing your organization from closing functionality gaps in your current accounts payable and commercial payments environment.
Let’s bust those myths and shed light on facts that can improve your organization’s end-to-end purchase to pay processes and improve your bottom line.
Myth: We already use AP automation and EAP.
Fact: You’ve made a great start, but it falls short.
AP automation is only the automation of invoice processing that comes prior to the payment itself, and traditional EAPs can still get mired in the supplier invoicing process. IP takes you a giant step further, integrating seamlessly with your AP automation program to incorporate and execute all payments types – virtual card, automated clearing house (ACH), check and wire to name a few – in a single payment process.
Myth-Busting Resource: Video Seamless and Secure Integrated Payables: Watch How it Works
Myth: An IP solution will require an “all or nothing” overhaul.
Fact: It doesn’t have to be daunting.
If the IP solution you choose has been developed to easily format payment files, it can be simple to integrate all payment methods without changing banks or AP software. In fact, the right solution provider should require minimal resources and IT dependencies. They should be able to execute all payments from a single payment instruction file without any patchwork in the background.
Myth-Busting Resource: Infographic Make Payments Profitable. It’s Easy to Get Started with Priority CPX
Myth: Suppliers are stubborn.
Fact: Suppliers are partners.
Both buyers AND suppliers are looking for ways to remove inefficiency and “friction” in making and taking payments. But with so many disparate approaches for payment by card, ACH and check, it has resulted in a fragmented supplier onboarding experience. Any payment solution partner you consider should develop an IP strategy that accomplishes two main goals:
- Make it easy for suppliers to accept your preferred methods of payment, and
- Drive value back to your organization with early payment discounts and cash-back benefits from rebates and incentives.
Myth-Busting Resource: White Paper The Role of a Supplier Value Proposition in a Successful Integrated Payables Solution
The advances in integrated payables solutions offer you the opportunity to increase security, transparency, efficiency and contribution to your organization’s bottom line at every step from purchase to payment. However, it’s important to differentiate AP automation, IP and AR automation and understand why your suppliers are key to the launch of a successful IP program for your organization.
To learn more about commercial payment types, download our e-Book Trends Driving Commercial Payments Evolution or contact a member of our team.