Accounts payable process automation is the use of software to manage supplier invoices, approvals, and payments with minimal manual effort. It replaces paper-based and spreadsheet-driven workflows with structured, digital processes that improve accuracy, control, and visibility.
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In a manual environment, accounts payable teams spend hours entering invoice data, chasing approvals, and resolving errors. Accounts payable process automation removes these bottlenecks by automating invoice capture, matching, approval workflows, and payment scheduling—helping businesses reduce costs and maintain strong supplier relationships.
This guide explains how the accounts payable process works, why automation matters, and how businesses can improve results using the right AP automation software.
What Is the Accounts Payable Process?
The accounts payable (AP) process covers all activities involved in managing money owed to suppliers for goods or services purchased on credit.
A typical accounts payable process includes:
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Receiving supplier invoices
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Verifying invoice details
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Matching invoices to purchase orders and delivery notes
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Routing invoices for approval
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Recording liabilities in the general ledger
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Scheduling and issuing payments
A well-structured AP process helps businesses control cash flow, maintain accurate financial records, and meet compliance requirements.
While accounts payable focuses on outgoing payments, accounts receivable (AR) manages incoming payments owed to the business.
What Is Accounts Payable Process Automation?
Accounts payable process automation uses technology to manage AP workflows from invoice receipt through to payment and reconciliation.
Instead of manually handling invoices, automation software:
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Captures invoice data using OCR invoice scanning
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Records transactions automatically in the accounting system
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Maintains a digital audit trail for every action
By automating repetitive tasks, finance teams reduce processing time, minimise errors, and gain real-time visibility into liabilities and cash flow.
Why Accounts Payable Automation Matters
Manual accounts payable processes are slow, costly, and prone to error. As invoice volumes grow, these inefficiencies scale quickly.
The benefits of accounts payable automation deliver measurable benefits:
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Lower cost per invoice
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Faster approval and payment cycles
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Fewer duplicate or incorrect payments
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Improved compliance and audit readiness
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Better supplier relationships through on-time payments
Studies show businesses can reduce invoice processing costs by up to 70% compared to manual methods. According to Grand View Research, the global AP automation market is expected to grow at a CAGR of 12.8% from 2024 to 2030, driven by cloud adoption and compliance pressures.
Accounts Payable Process Automation for SMEs
Small and medium-sized enterprises often feel the impact of inefficient AP processes most acutely. Limited finance resources mean manual invoice handling quickly becomes a bottleneck.
For SMEs, accounts payable process automation helps to:
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Reduce admin workload without increasing headcount
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Improve cash flow forecasting
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Eliminate paper and email-based approvals
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Support remote and decentralised teams
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Scale finance operations as the business grows
Automation allows SMEs to operate with the same financial controls as much larger organisations, without the associated overhead.
UK Accounts Payable Process Statistics and Compliance
In the UK, inefficient accounts payable processes contribute directly to late supplier payments and cash flow pressure.
Research from the Chartered Institute of Procurement & Supply (CIPS) indicates that around 60% of UK businesses experience late payment issues. These delays damage supplier relationships and increase financial risk.
UK initiatives such as the Prompt Payment Code encourage organisations to pay suppliers on time and report on payment performance.
Organisations using accounts payable process automation report:
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Faster invoice processing
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Over 75% fewer processing errors
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Improved compliance with internal policies
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Stronger supplier relationships
Automation plays a key role in meeting regulatory expectations while maintaining operational efficiency.
Common Accounts Payable Process Terms
Invoice
A document issued by a supplier detailing goods or services provided, amounts owed, and payment terms.
Purchase Order (PO)
A formal document issued by a buyer outlining items ordered, pricing, and terms.
Accounts Payable Automation
The use of software to reduce manual work by capturing, validating, approving, and recording invoice data automatically.
OCR (Optical Character Recognition)
Technology that converts scanned invoices or PDFs into machine-readable data for automated invoice handling.
Why Zahara for Accounts Payable Process Automation?
Zahara provides purpose-built accounts payable process automation designed for growing finance teams.
Key benefits include:
Time savings
Reduce invoice processing time by up to 90% using OCR and automated workflows.
Improved accuracy
Prevent duplicate payments, missed invoices, and data entry errors.
Cost control
Capture early payment discounts and reduce admin and storage costs.
Audit readiness
Maintain a complete digital audit trail for every invoice and approval.
Real-time visibility
Track invoices, approvals, and cash flow through live dashboards.
Compliance support
Enforce approval workflows and meet regulatory requirements.
Supplier confidence
Ensure consistent, on-time payments to strengthen supplier relationships.
Secure document storage
Store invoices and approvals securely in the cloud.
Remote access
Approve invoices and manage payments from anywhere.
Strategies for Optimising the Accounts Payable Process
To get the most from accounts payable process automation, businesses should:
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Define clear approval workflows
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Assign roles and responsibilities clearly
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Integrate AP software with accounting or ERP systems
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Monitor KPIs such as cost per invoice and approval time
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Provide regular training for AP users
Continuous optimisation ensures automation delivers long-term value.
Accounts Payable Process Automation FAQs
What are the key stages in the accounts payable process?
The accounts payable process typically includes:
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Invoice receipt and verification
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Matching invoices to purchase orders and delivery notes
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Approval workflows
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Payment scheduling and execution
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Ledger reconciliation
How does accounts payable process automation improve efficiency?
Automation reduces manual data entry, speeds up approvals, and provides real-time visibility into liabilities. It also improves accuracy and creates audit-ready records.
What is OCR and why is it important in AP automation?
OCR converts scanned invoices and PDFs into structured data. In accounts payable process automation, OCR removes the need for manual invoice entry and speeds up processing.
For an external overview, see TechTarget’s explanation of OCR technology.
How does Zahara integrate with accounting systems?
Zahara integrates with leading accounting and ERP platforms, including Microsoft Dynamics 365 Business Central and QuickBooks Online. APIs are also available for custom integrations.
What compliance benefits does AP automation provide?
Automation supports compliance by:
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Maintaining digital audit trails
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Enforcing approval controls
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Reducing fraud risk
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Supporting timely, accurate payments
Automating Accounts Payable in Microsoft Dynamics 365 Business Central
Microsoft Dynamics 365 Business Central is a powerful ERP platform, but invoice processing and approvals often require additional automation.
By adding accounts payable process automation:
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Reduce invoice processing time and cost
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Minimise late payments and fraud risk
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Improve visibility across approvals and cash flow
Zahara integrates seamlessly with Dynamics 365 Business Central, extending native functionality and improving AP control.
Automating Invoice Processing in QuickBooks Online
Manual invoice handling in QuickBooks Online creates delays and increases error risk.
With accounts payable process automation, businesses can:
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Capture invoices automatically
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Route approvals without email chains
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Maintain accurate, up-to-date records
Zahara integrates directly with QuickBooks Online to simplify invoice processing and approval workflows.
Best Practices for Accounts Payable Process Automation
To maximise the benefits of automation:
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Choose reliable suppliers with clear invoicing standards
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Select software that fits your approval and reporting needs
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Ensure seamless system integration
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Monitor performance and refine workflows regularly
The right approach ensures automation delivers consistent, measurable results.
How Accounts Payable Process Automation Improves Financial Reporting
Automated AP improves financial reporting by providing:
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Real-time visibility into liabilities
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Fewer posting errors
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Faster month-end close
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Stronger compliance and audit support
Finance teams spend less time correcting data and more time analysing performance.
Why Automate Your Accounts Payable Process?
Manual accounts payable processes increase costs, slow operations, and create unnecessary risk.
Accounts payable process automation improves control, accuracy, and visibility—allowing finance teams to focus on strategic work rather than paperwork.
Ready to improve your AP process?
Explore Zahara’s pricing or book a demo to see accounts payable process automation in action.
