That old saying, “the check’s in the mail,” has an elusive, slightly untrustworthy connotation. Is it really in the mail? But this saying can now be flipped because a hypothetical, invisible medium can now pay the bills for middle-market companies with reliability and transparency. There is no check in the mail, but the funds will get there with no tangible, paper check, almost by magic. Yes, electronic payments are here to stay, and forward-looking accounting departments can scrap paper checks entirely. Electronic payments solve many of the problems faced by companies as they seek to grow while controlling their costs.
Printing and mailing checks is a cost for businesses, plus it is painfully slow. Wire transfer and ACH are somewhat faster, but there are fees, plus they can take a few days to clear. Newer electronic payment methods like virtual credit cards (VCCs) are rising quickly as better ways to run AP and AR. For buyers, one study by Deloitte found that processing an invoice the traditional way costs a company $73 while using card-based processing cost only $20, where reduction in paper-based processing, administration effort, approval overheads and banking costs yields a significant cost savings. For vendors and suppliers, the majority of respondents agreed that accepting B2B card payments resulted in less effort spent chasing payments, better customer relationships, and improved reconciliation. On top of that, 45% of businesses surveyed said that accepting card payments had increased their sales.
The digital revolution has arrived for most consumers and big companies. Yet middle-market companies comprise about 40% of the U.S. GDP. They are ripe for the efficiencies and savings that have helped the largest companies to reap the advances of newer technologies. With the rise of big data and machine learning, the transformation to electronic payables and receivables is now within reach for mid-sized companies. The technology is there, and the cost savings make it worth the jump. Plus, reducing wasted paper is better for the environment and saving on labor costs is good for the bottom line. Faster processing of payments helps cash flows on both sides of the equation, eliminating late fees for payors while allowing payees to relax with quicker access to income. At this point, the advantages of switching to electronic methods in accounting are hard to ignore, even for smaller companies.
Organizations can now adopt end-to-end electronic processes for AP and B2B payments. Cutting-edge machine learning, cloud analytics and AI data capture technologies from Scrypt AI provides a first-in-class solution for middle-market accounting transformation.