3 Trends In Accounts Payable Automation For Which To Watch Out#supplychain #fintech #tradefinance #supplychainfinance #digitization #digitaltransformation
Automation of processes ranging from procurement to payment has been talked about for several years now. With technologies like Robotic Process Automation and Machine Learning becoming available to improve the invoice-to-pay or the Accounts Payables (AP) leg of the process, what was talked about is now taking shape.
Traditionally, Accounts Payable departments used to be cost centers with several manual processes, inefficiencies and redundancies. That has changed and technology has transformed Accounts Payable departments into business intelligence analytics centers. In fact, a recent study by McKinsey has shown that automating procure-to-pay processes can reduce spend by up to 3.5% in today’s competitive environment.
Here are three Accounts Payable automation trends gaining momentum:
1. Accounts Payable Automation Enables Data-Driven Decision Making
Traditionally, most of the manual efforts by Accounts Payable teams used to be invested in data entry, invoice tracking and reconciliation. This also led to human errors and time had to be wasted to identify and fix them.
After automation, data is captured systematically in a centralized manner. Such data is then analyzed on a real-time basis making advanced analytics possible. This real-time data has made forecasting more accurate. It has enabled Accounts Payable teams to help treasury teams track spending patterns and manage cash flows better.
In other words, automation of Accounts Payables has made data-driven decision making a reality and Veefin’s supply chain solution has incorporated such features.
2. Cloud Technology Has Increased Visibility Of Data
Integration of billing systems to cloud infrastructure has not only ensured quicker approval time, but also given all stakeholders access to real-time data.
This has led to building dashboards with insights on this real time data, leading to much quicker data-driven decision making which was not possible prior to automation. Such integration has also ensured that progress can be tracked by teams working at multiple geographical locations.
The pre-automation era when decision making depended on outdated data captured only after a significant lag time is now a tale of the past.
3. Effective Fraud Control And Improved Turn Around Time
Before automation, lost and double paid invoices used to be relatively common, due to manual processing errors, with no system to trace them. As a result, corporate anchors used to worry if they had discounted an invoice involved in a genuine transaction or a fraudulent one.
Automation has removed all such concerns by bringing centralized transparency to all transactions, making it easy to get flagged. Automated systems triggered off alerts for duplicate invoices or when multiple employees try to process the same invoice.
Automation has also removed the need for paper checks with solutions such as Veefin-SCF offering seamless integration with Enterprise Resource Planning (ERP) modules.
This has led to increased real-time visibility to build adequate and sufficient checks to avoid such a fraud or mistake theory effectively reducing the overall turnaround time and costs.
Late payments which risk supplier-corporate anchor relationships are eliminated, and cash cycle times are significantly reduced.