A key responsibility for every finance team is to manage your company’s transactions, and one of those key tasks is to handle payments to vendors and suppliers. Not only are manual processes arduous and time-consuming, but they’re also incredibly vulnerable to errors. We’re all guilty of making these mistakes occasionally, but over time there are serious knock-on effects, from late or missed payments to exasperated suppliers. If you’re on the fence about automating payments, we’ve put together five reasons why it’s an absolute must.
1. Save Time and Reduce Manual Errors
It doesn’t need to be said, but manual payment processing is a time-consuming task. There’s an abundance of steps, including data entry, verification, approval, and reconciliation. With every step, there’s the chance of errors that you may not notice until it’s too late. And why leave that to chance?
When you automate, you streamline your process, and part of that streamlining is the elimination of manual data entry. This massively reduces the chance of error, because intelligent software will pick up on mistakes that even the most diligent among us will inevitably miss. Worthwhile automated payment systems will integrate with your accounting software and sync your financial data, including payments, invoices, and bills. Again, this is a huge time-saver.
2. Improve Cash Management
The importance of cash flow management can’t be overstated, and automated payment processing can go a long way in improving your cash flow control. Automated payment software will provide you with real-time information on cash flow and expenses, so you can monitor your payments and adjust your financial strategies accordingly.
With an automated payment system, you can also schedule payments in advance, meaning that a world exists where you never miss a payment again. You can imagine the benefits of knowing you’ll never incur late fees, and keeping your supplier relationships pristine.
3. Increase Security and Compliance
The darker side of making errors with a manual payment process is that they can lead to serious security risks and compliance issues. Automation can help you eliminate the risk of fraud and errors, ensuring that your payments are accurate and secure, something which should be non-negotiable.
An automated payment system can also be a massive help when needing to comply with external regulations and internal policies. Fortunately, with automated payment software you can set up workflows and approval processes to ensure that all payments comply with company policies and regulations.
4. Strengthen Vendor Relationships
Automated payment processing helps maintain and build relationships with your suppliers. Your trusted vendors need prompt payment, and having a reliable system in place means you can easily meet and exceed their expectations.
From a more selfish (but practical) perspective, making speedy payments can help you negotiate more fruitful and flexible payment terms with your suppliers, reducing your overall costs.
5. Reduce Costs and Improve Efficiency
The bottom line is that manual payments are costing you. Inevitable late fees aside, it’s an uneconomical and inefficient process, and requires significantly more time than you might think.
Although it may seem like automated payments are just another unnecessary add-on, over time sticking with manual payments is what can truly cost you.
These are just a few reasons why now is a great time to think about automating payments. On its own, the peace of mind knowing you’ll never miss a payment again makes automating worth it. Exploring your options and keeping an open mind is incredibly valuable, and we’re happy to help if you have any questions or worries- our team is just a call or message away!