Benefits from AR Automation

accounts receivable automation

Are you aware of the advantages of accounts receivable automation? Conventionally, a bank lockbox has been used by company Accounts Receivable departments to increase expediency.

Lockboxes have been around for decades and much of the traditional bank lockbox's life has been used for capturing payment information associated with payments made by check. Big provided this amenity to improve effectiveness and flow of company transactions streamlining the accounts receivables collection process.

Clients basically use the bank lockbox to receive check payments in one consistent location.

Bank lockboxes are purposefully placed in a central location to decrease mail delivery time, which also assists with lowering the business’ Days Sales Outstanding (DSO). Banks receive the paper check, process it along with the remittance data and send the information back to their customer. Because banks are processing checks and remittance this decreases the clients A/R workforce and increases their efficiency. The price of the bank lockbox is usually a monthly cost along with a per line remittance data processing cost. To process a large number of checks over time can be expensive with a lockbox.

Today, we see a big change with Accounts Payable Departments paying electronically. This change to ePayments has elevated the FinTech industry with {solutions| designed with the goal of decreasing business costs of processing incoming payments.

 

 

Weaknesses of a Traditional Bank Lockbox



The lockbox often is relatively expensive . Banks normallyacquire a monthly rate along with a per line fee associated withprocessing payment remittance detail .

Lockboxes can contain security concerns . The traditional bank lockbox still requires a fair amount of manual re-keying data . With the majority of manual data entry attendance being entry level-administrative workers who are new to the bank or an outsourced contractor . The information from the lockbox provides all vital components to produce a fraudulent check .

Lockboxes don’t tie into your accounting system . Bank lockboxes process your payments and remittance data thenforward you the information . Your organization still must key in that information into your ERP to clear the cash .

Financial Institution Lockboxes Are Creating problems for your Customers' AP Department . Organizations are modernizing their AP Department to get rid of manual process and deciding to pay their clients electronically via ACH , Credit here Card or vCard . These preferred methods of ePayment are creating an increase in email remittance . FinTech solution businesses have bridged the gap to servethose firms in a cost efficient scalable solution for automating Accounts Receivable .

 

 

Rewards of a FinTech Lockbox
Reduced Cost


The main objective of the FinTech Lockbox will be to reducepricing per transaction and supply an Accounts Receivable automation tool to letcompanies to rapidly clear cash and improve access to your working capital .

Trouble-free payment trail
It is simple to track incoming ePayments from one place. Rather than flipping through remittance emails or going to the vendor portal to download and read payment data . The AR Lockbox gives you a single place to hold All of your incoming electronic payments created for swifter cash application .
Eliminates mail float
Mail float is a term for the time needed for a check to go from the payer to the payee via the postal service . With the increase in B2B payments electronically , mail float is swiftly turning into a productof the past . The rise in electronic payments choosing FinTech Lockboxes with an essential focus on the fee reduction and speed in which you clear cash and apply it to your working capital .


1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Comments on “Benefits from AR Automation”

Leave a Reply

Gravatar