Firms can now choose from a variety of payment methods when sending or receiving funds, which means the companies they do business with must maintain multiple systems to accommodate disparate needs and preferences.
As the payments landscape has gotten more complex, it has also become more challenging for firms to seamlessly and cost-effectively manage their accounts receivable (AR) and accounts payable (AP) processes.
As a result, companies allocate 23% of their AR department staff members toward managing payments, according to the Next-Gen Digital Payments Report, a PYMNTS and Transcard collaboration.
Also see: Next-Gen Digital Payments Report
“There never seems to be enough hours in the day for AP and AR professionals,” Transcard CEO Greg Bloh told PYMNTS. “They spend their days on manual, repetitive activities such as keying data, shuffling paper and chasing down information.” Enhancing B2B Processes
Most organizations handle their B2B payments through methods, channels and tools as diverse as paper checks, automated clearing house payments and virtual cards — all managed through separate accounting systems.
But more and more businesses have been taking steps to enhance their B2B payment processes, including moving on from manual or outdated payment methods, such as paper checks, in favor of digital methods.
Still, many are reliant on multiple systems or applications to manage their digital payments, invoicing or other AR and AP processes, leading to lingering frictions even after they have moved forward themselves toward B2B digitization.
“A lot of the blame can be laid at the feet of poorly integrated payments and ERP systems,” Bloh said. “It does not have to be this way.”
Integrating Payments and ERP Systems To ease the transformation, businesses need to find solutions that help them aggregate all their payments in one place, allowing them to view and manage their AR and AP processes with more clarity.
This is where integrating payments capabilities with enterprise resource planning (ERP) systems can play a key role. Solutions incorporate multi-rail payment capabilities, seamless uploads of remittance data to any ERP for real-time integration, and built-in supplier and customer onboarding. Integrating payments and ERP systems can help businesses stitch together traditionally fragmented B2B payments through one holistic platform.
This “wipes out most of the friction that bogs down AP and AR teams,” Bloh said. “Payments can be made and received using any method. Remittance data can be uploaded directly to an ERP without human operator intervention and reconciled in real time, and decision-makers always know where things stand with their cash flows.”
Freeing up Time and Money For optimal transparency and seamlessness, it is important for businesses to pair those integrated payments and ERP systems with other emerging technologies. Successfully aggregating ERP services into one easily managed system requires application programming interfaces (APIs) to make systems easier to use, for example. Automation can also help smooth out previously fragmented processes.
One recent PYMNTS study found that 79% of firms agreed that incorporating AR automation improved their teams’ efficiency. It can also free up time and money, allowing teams to focus their energies on growing the business or strengthening client relationships.