Eliminating Manual Payment Hurdles

Payment Automation successfully mitigates multiple problems that may potentially crop up with the manual payment process. According to some estimates, the monthly vendor payments made by the typical business range from 25 to 303. The most popular challenges are as below:

A. Multiple payments

The same invoice might be unintentionally paid twice by staff. The company's anticipated cash flow will be impacted by this, particularly if the invoice amount is substantial. Additionally, it will increase the workload for the accounting team because they will need to coordinate with the vendor to ensure the reimbursement. According to a study conducted by the audit group (TAG), almost 50% of the duplicate payments made by their clients were the consequence of data entry errors made by hand.

B. Payment fraud

Payment fraud can in a variety of forms. They mostly relate to an employee, for the purpose of this explanation, committing acts that illegally obtain company funds. The first of the instances is misusing company funds for individual purposes. The second is overestimating a PO in an attempt to cut some corners, which is just as detectable as the first. Finally, sharing confidential financial information with unauthorised individuals, in the way of posing a security risk also amounts to payment fraud, and can be mitigated with the help of automated payment processes.

C. Late Payment

A typical person can only process so much data at once. Computer systems are impervious to this weakness and are constantly functional. You obtain quicker processing times & more consistency when you hand off the payment procedure to the computer system.

D. Poor Supplier Relations

According to a poll conducted in 2021 by Medius, a top provider of cloud-based spend management systems, businesses lose 24% of their orders as a result of poor supplier relationships. 73% of respondents claimed that late payments damaged their relationships with their suppliers. It was also determined that manual data entry errors or employee forgetfulness could result in late payments, which could harm vendor relationships and lead to a bad brand reputation.

Each of these errors and hurdles is capable of being corrected and even avoided with the correct implementation of an automated payment system.