Finance Process Automation Reinvented

Nowadays, finance process automation is no longer a luxury but a necessity for global businesses. Automation, driven by technology like AI, is reshaping financial management practices from payroll and bill payments to complex financial processes. A study on automation from McKinsey Global Institute revealed that technology can fully automate 42 percent of finance processes and mostly automate an additional 19 percent which highlights the the transformative power of finance automation.

In this article we will delve into finance automation and its benefits including cost reduction, faster payment processing, increased productivity, fraud prevention, improved vendor relationships, reduced human errors, and enhanced insight into financial data.

There are a few different levels of automation that all offer a different user experience. The first forms of automation are macros and scripts which are simple rules-based automation that repeats simple work with highly structured data. This includes things like general accounting operations, revenue management, and cash disbursement, which are fully automatable with existing technologies in over 75 percent of cases. Robotic process automation (RPA) forms the base of macros and scripts and can complete repeated operations rapidly and with low effort.

Artificial intelligence is at the other end of the spectrum. Theoretically, the incorporation of artificial intelligence is accomplished when software can make intelligent judgments while still adhering to controls via algorithms or machine learning. Machine learning algorithms exhibit computers' capacity to take in a steady stream of data, evaluate that data for patterns, and offer solutions to issues people can't even notice, resulting in dramatically improved financial proficiency. What was once a dream for finance experts and company owners is now becoming a reality. These advancements are shaking up the way activities are conducted and putting new elements into the mix, such as forecasting.

Embracing finance automation may seem daunting at first, but as more organizations integrate it into their daily financial operations, its worth becomes increasingly evident. Here are 7 key benefits that automating finance operations can bring to your business.

Business Spend Management: Control Company Spending

To put it simply, electronic payments are less expensive than paper checks. According to a 2019 analysis by Levvel Research, organizations that used highly automated accounts payable procedures paid €2.36 for each invoice on average. Companies that used limited automation, on the other hand, spent €15 on each invoice, more than six times as much as their competitors.

Mailing checks require printing supplies, stamps, paper, and, of course, staff work, which is one of the reasons why manual payments are so expensive. Payments are significantly less likely to slide through the cracks now that electronic payments are more visible, ensuring that businesses is not penalised with late fees.

When B2B payments are processed manually, invoices might languish on desks or in email inboxes for days, if not weeks, awaiting clearance. By standardizing the approval procedure, payment automation eliminates most delays. Accounts Payable (AP) departments can use automation technologies to specify who authorizes which invoices by when and send reminders or error messages if those criteria are not followed.

The top B2B payment automation solutions have configurable dashboards that provide a high-level, real-time overview of invoice processing, providing AP executives with immediate visibility into any pending bills.

B2B payment automation removes the need for human processes. This not only allows AP team members to work more effectively but also provides them the time and energy to focus on more strategic initiatives that may help the business grow. Furthermore, contemporary B2B payment automation software is cloud-based, allowing AP teams to collaborate or operate independently in a secure environment regardless of their location or device.

Manually monitoring check payments is difficult and time-consuming. It's easy to overlook red flags while performing checks by hand. This is especially troubling given that checks are the payment type most commonly used by people conducting or attempting to commit fraud.

Fraud may be a financial nightmare for your organization, but B2B payment automation reduces the likelihood of fraud by:

Identifying incorrect invoices

Controlling which users are permitted to do specified activities

Providing entire transaction visibility

Detecting missing or inaccurate information

Automating your finance services can give your AP team peace of mind and a potential rise in the probability of pulling ahead of the competition without shoring up vulnerabilities against fraud.

Having an all-star reputation for paying bills on time distinguishes you from competitors and strengthens your connections with suppliers. Developing excellent vendor connections is critical to the success of your organization. B2B payment automation maintains existing strong vendor relationships in a variety of ways, including:

Faster service - Automating payments saves the time it takes suppliers and AP team members to reply to invoice and payment status inquiries.

Real-time visibility - B2B payment solutions provide an ACH portal that allows suppliers to see the progress of their transactions in real-time.

Shorter Payment Cycles- With B2B payment automation, critical KPIs like Days Sales Outstanding are lower (DSO).

Payment errors occur, however they occur significantly less frequently with automated payments.

On-time payments - B2B payment systems automatically transmit payments on or before their deadlines.

Keeping penalties at bay - Nothing ruins a buyer-seller relationship like late fees, but with B2B payment automation, you can keep your working relationship good.

As you are aware, human data input is far from ideal, and even little errors may divert important time away from critical tasks, harm customer and supplier relationships, and result in duplicate payments, overpayments, or underpayments. B2B payment automation identifies minor difficulties before they become large concerns. With the right software, mistakes will be few and far between.

B2B payment automation software gathers financial data by default, which is essential for doing sophisticated analytics. Using financial technology like analyzing AP operations can show opportunities for process improvement and provide inspiration for ways to shorten the payment cycle.

B2B payment services, for example, clearly display which phases of the cycle take the longest, where approval bottlenecks are located, and who to contact when there are delays. Furthermore, financial data may be imported and exported in real-time, providing AP teams with the information they need to submit quarterly reports on time. Improved insights and visibility can pave the way for the integration of other strategic tools that improve cash flow, such as ERPs or human capital management systems.

Fyorin is a payment and financial operations platform that helps businesses of all sizes to automate and monetize their financial operations teams. Fyorin makes services swift, flexible, and frictionless for all your customers no matter what part of the world they may be in. We also offer countless benefits that range from tailored financial products for your business across a curated network of financial providers. From one unified platform, Fyorin offers multi-currency business accounts, sub-accounts, automated payables, and corporate virtual cards to better control and manage spending throughout your organization, helping your business keep risks low and your services automated.