Processing payments is one of the most expensive and time-consuming tasks for most companies. An accounts payable study by CFO Magazine found a wide variation in the cost of payment processing among U.S. companies, from $2.07 to $10 per transaction.
AP Cost per Invoice
So, what was the cause of the variation? Automation. The companies that were accomplishing per-transaction costs under $3 had implemented some form of payment processing automation. In fact, the authors of the study made this observation:
“Many of them invested long ago in technology to automate accounts payable and accounts receivable, reducing the amount of labor required to keep the money flowing in and out.”
If your company isn’t using automation for its payment processing, perhaps it’s time to rethink your options. Here’s a closer look at some important factors to consider.
Can You Automate Payment Processing?
Sometimes, a company’s employees feel that payment automation isn’t possible, or wouldn’t really make a difference. However, 93% of payment processing functions can benefit from automation.
Freeing up that much departmental bandwidth can be a huge game-changer. Instead of being bogged down by routine demands, team members could give more attention to higher-level activities that improve your company’s bottom line and give you a better competitive standing in the marketplace.
For example, they could engage in financial analysis that improves your company’s financial picture. They could make suggestions that help you stay innovative, like finding additional ways to automate tasks and further improve efficiency. These tasks are also supported by software automation because your staff can pull reports, make forecasts, and conduct detailed analyses, all within the platform.
What Does Payment Processing Automation Look Like?
A good payment processing platform provides fully digitized automation that facilitates your daily processing activities and makes you more productive. When investigating your options, look for a solution that offers all of the following benefits:
Multiple functions should be brought together into one cohesive workflow, including purchasing, contracting, sourcing, and task management.
Payment processing should take place in a guided system with notifications, confirmations, prompts, reminders, and alerts.
Processes should be enforced by the software’s logic in a way that supports end-to-end compliance. This includes vendor compliance.
The platform should offer detailed tracking in multiple categories like contract, vendor, and category of spend.
- UX Improvements
The interface should be easy to use without extensive training and ideally, there should be a self-service format you can offer to both internal and external customers.
The right kind of payment processing automation gives your company an immediate boost in productivity. It reduces communication problems, allows you to easily meet deadlines, and supports great customer service.
The Math Matters
If you’re wondering about the exact financial impact of implementing automation, take a look at this calculation of the savings involved.
Looking at the numbers, you’ll see a typical savings of $1,350 per month for a company that processes 100 invoices. Larger companies will see even more significant results.
When you use a software system like ProcurementPath, it can mean an immediate difference where you’re going from $15 per manually processed invoice to just $5 per invoice. When you add that up and look at the impact over the course of a year or more, that’s a huge savings for your company.
Watch: Automating procurement on ServiceNow Webinar
Do you need to automate your procurement process and step up your company’s efficiency? If so, we invite you to explore ProcurementPath, the cloud-based productivity tool that streamlines procurement.