The research is clear: Digital payments automation and other modernized processes bring significant efficiencies for both B2B buyers and sellers. While the need for such solutions is clear, many firms still cope with paper checks and other outdated tools.
Indeed, PYMNTS found that 30% of accounts payable (AP) professionals say their companies struggle to process invoices efficiently. According to findings in The Digital Shift Report, a PYMNTS and Corporate Spending Innovations (CSI) collaboration, 70% of AP professionals want to innovate AP to save time, and another 38% want to innovate to reduce payment errors.
See also: The Digital Shift Report
“Finding the right AP automation partner is critical to increasing efficiency, reducing costs and [seeing] continued business growth,” David Disque, president of CSI, told PYMNTS.
Updating AP Operations
That’s one of the tasks corporate buyers must perform as they examine how they can update their AP operations to modernize processes for business partners and staff members. This push for change is leading firms to adopt a variety of digital payment methods, like automated clearing house (ACH) and virtual cards, which can enable them to deliver funds more rapidly to vendors and employees.
Payment automation providers that offer flexible virtual card payment delivery options, such as straight-through processing, which improves the supplier’s days outstanding and greatly reduces back-office operations, bringing significant efficiencies for both B2B buyers and suppliers, Disque said.
Those benefits cannot be delivered if a payment automation provider can only handle one network or can provide virtual cards but can’t issue the cards, so it’s important to choose the right partner.
Saving Personnel’s Time
It’s also important for buyers to educate their suppliers if they don’t currently accept virtual cards. If a supplier’s preferred payment methods do not include virtual cards, it’s worth the buyer’s time to share the benefits of virtual cards and compare the costs.
“In most cases, the savings in personnel’s time due to faster reconciliations, reduced check fraud and getting paid faster may outweigh card fees,” Disque explained. He added that integrated payables platforms allow buyers to manage all payment types with automation and heightened security.
Eliminating Pain Points
“Payments are decentralized and, with centralized payment platforms that offer integrated digital payments, many pain points can be eliminated,” Disque said.
Businesses are looking to boost performance by adopting technologies that can quickly extract pertinent details from invoices and feed them into AP systems, PYMNTS reported. Time-pressed employees would prize such a move, with 70% of U.S. workers saying they would like to automate basic tasks, such as data entry.
When CSI and Citi Commercial Cards announced last spring that they had joined forces to provide B2B payment offerings to Citi customers, they noted that this will provide new ways for Citi’s clients to make streamlined payments to eCommerce suppliers, especially in the digital media and advertising space, and that CSI’s platform will also function as the centralized tool for initiating payments and reconciling them.
Managing Various Payment Methods
Another challenge to the overall B2B payments process is the chore of managing various payment methods. In North America, businesses are challenged with managing multiple payment processes and still rely on outdated legacy payment processes, such as paper checks. Some payment methods take longer to process and come with high operational costs.
“A major issue is the increased time it takes buyers to pay suppliers. This interferes with cash flow management and early discounts, as well as [causes] potential damage to the buyer-supplier relationship,” Disque said.
The good news is that the problem can be fixed with updated processes that are often less disruptive to install than B2B firms might fear, yet more affordable than they might seem due to cost savings and strengthened buyer-seller relationships.
Read More:AP Professionals Struggle to Process Invoices