For many years, businesses have used traditional payment systems like checks. But due to lack of flexibility, low-level security, and complicated transactions, payment automation is increasing its importance among companies from multiple sectors. The business-to-business space has shifted to payment automation. In 2019, for example, experts believed there were approximately $4.1 trillion in digital transactions, and the number is projected to increase in the future.
The recent Worldpay Global Payments report suggests that over 36% of global online shoppers prefer eWallets. It is followed by credit cards (23%) and debit cards (12%).
The Paypers Payment Methods report showed that almost 2.1 billion consumers used an eWallet to may payments or send money in 2019 alone.
Experts say that any method of payment can play a significant role in customer experience. It can either lead to disappointment or result in client satisfaction.
Of course, as a business owner, you want the best for every client you transact with. Payment automation can do the trick.
Why Payment Automation is Critical for Your Business
You may start to wonder why businesses are switching to payment automation. Here are a few reasons you should streamline your payment procedure now:
1. Lower Payments Costs Than Traditional Ones
Would you believe that an average business could be spending around $24,540 per year on processing paper checks?
Yes, you heard that right. That is massive as it includes bank fees, employee labor, postage, and materials, according to Bill.com.
A reporter of The Wall Street Journal said that checks are indeed a burden to the economy.
For businesses, regardless of niches and sizes, it is time to transition to digital payments. They are cheaper and more popular than checks for a reason. Research conducted by Ardent Partners found that automation could lead to 80% more cost-reductions than conventional payment methods.
Paper checks also pose costs for your customers. Every time you receive mailed checks for any recurring payments, your client is paying for the envelope, check, and postage, too.
Whether you have been spending thousands of dollars on checks or looking for ways to save some cash, payment automation will be a wise move. The transition from paper checks to an automated payment method is challenging. But you will get used to it.
2. Save a Lot of Time in Paying Employees and Suppliers
Paper checks eat up our time without a doubt. Businesses, for example, wait for checks in their mail for days or months. That could definitely waste your time.
Of course, you would be happy if you finally receive the check. What if the check bounces? Well, you have to track down your customer, and it is disappointing. Plus, you could use that time to focus on other important business aspects.
Bill.com estimates that any organization spends around $1,280 in labor costs to prepare for checks every year. If you still follow the traditional payment method, you could save money and time as well.
Before they can be mailed out, customers also spend a few minutes writing them at checkout, which can be inconvenient for them.
Aside from that, checks add more volume to government offices’ workflows, which may incur costs and take up time for employees.
So, when you invest in digital invoices and an automated payment solution, you also help your customers and government offices. What are you waiting for?
3. Avoid Mistakes and Transaction Errors
Let’s admit it. According to the New economy, any manual processes have a high risk of human errors, which can lead to serious consequences.
Manual payment is no exception. With many responsibilities to fill in and carry out, the chance of sending incorrect invoices to clients or receiving duplicate payments is not uncommon.
Practicing automated payment, however, is worth it. With the right automated payment services, you can prepare invoice charges when the contract is created and send a text message reminding your customers of these charges.
Why would you take the risk of committing errors if there is innovative payment software you could try?
Yes, the services may require extra costs. But having an error-free payment can contribute to client satisfaction and happiness.
Payment automation software may also notify you when payments fail and validate your data entry.
Over time, it is a good opportunity for your business to improve, enabling you to stand out from the competition.
4. Drives Faster Financial Reconciliation
Reconciliation plays an integral role in ensuring compliance and tight financial control.
However, organizations perform financial reconciliation manually. During an account closure process, employees usually pull out boxes of records/receipts and fill out long spreadsheets.
With the time pressure, the finance team prepares reports with discrepancies or inaccuracies.
Say bye to the hassles with automated payment software. The right application allows you to avoid preparing written reports and records of profits and expenses.
The more simplified your process is, the quicker that payments will be collected. You can also pay suppliers on time without any unexpected interest fee or penalty.
What else? Your staff does not need to worry about entering figures on reports or check if the data is accurate. Therefore, they will have time to handle every aspect of your business operation and transaction.
Data accuracy? Faster financial reconciliation? Employee productivity? Low-interest rates from suppliers? Name it! An automated payment solution can make them happen.
5. Keep You Away From Fraud and Other Suspicious Activities
In 2011, global losses from payment fraud were approximately $9.84 billion. That’s high.
But in 2020, the losses from payment fraud reached up to $32.9%.
Payment fraud is estimated to increase up to $40.62% by 2027, which is alarming.
Checks, more particularly, are among the most forged payment methods. According to Ernst & Young, over 500 million checks are counterfeited, with $10 billion losses.
If you have experienced payment fraud before, do not give other scammers and fraudsters another chance to do the same thing.
To reduce your risk, upgrade and automate your payment method/procedure today. The best software limits users to authorized functions and report invalid invoices, taking your safety and protection to the next level.
Many businesses ignore modern payment software until they lose a thousand dollars to fraudsters. You do not need to wait for that nightmare to happen. Prepare in advance.
6. Forecast and Manage Cash Flow Efficiently
Forecasting cash flow is a great way to promote constant business success. It allows you to predict cash surpluses and shortages, compare expenses and income for a specific period, estimate the effects of any business change, and prove your paying ability to public/private lending institutions.
Predicting cash flow is tricky. Fortunately, using a high-end and reliable payment method can help forecast and manage your cash flow efficiently.
How does it happen? Well, it is not as complicated as you imagine.
A system that keeps reports and records of monthly recurring revenue enables you to project cash flow like a pro.
On the other hand, having accounts on net billing terms and automatic payments assist organizations in managing cash flow better.
That’s not all! Automated payment enables you to identify which customers might need extra attention.
If you experience a hard time projecting your cash flow, an automated payment solution will come to your rescue.
7. Have a Centralized Financial Track Record and Database
Most businesses use multiple payment applications. You do not have to do that as there are comprehensive payment platforms you should try.
Investing in various payment software can mean extra charges. If you run a startup or mid-sized business, it would cause a dent in your savings over time.
Why don’t you consider a full-fledged payment solution instead? Although it may cost you an arm or a leg in the first place, it will protect you from any headache and discomfort.
A feature-packed payment platform provides a dashboard for your payment lifecycle. You can have full access to revenue insights while tracking active recurring revenue, customer lifetime value, etc.
Generally, a dashboard is user-friendly and intuitive. That means there is no coding knowledge required. It is easy to use and will not be a disappointment.
Choosing a platform, however, is tricky. With time, effort and commitment, everything is possible.
8. Improve Relationships with Suppliers and Boost Employee/Client Retention
Each second matters.
But traditional payment methods can slow down your transaction or production.
Put an end to that ever-ending headache with a trustworthy, cutting-edge, and professional-grade payment solution.
As a platform streamlines your operation, you can improve and establish a long-term relationship with suppliers and clients.
According to Review 42, more than 82% of customers stop doing business with a company if they are not satisfied with the customer service.
Every time organizations lose clients to a competitor. They might lose $1.6 trillion.
Automating your payment procedure can contribute to a stress-free and comfortable customer experience.
A recent HR report also suggested that employee burnout is responsible for the 50% turnover every year.
While there are several factors that cause employee burnout (career stagnation & toxic coworkers), outdated payment application is another contributing factor.
When the payment process is made more accessible, your employees may always feel eager and passionate. But do not forget to set suitable workloads, provide proper support, and enforce a life-work balance.
You have finally decided to use an automated payment solution. It’s a great choice. Unfortunately, it is overwhelming to look for the best platform you deserve regardless of your experience.
Of course, you want to invest in a payment application that improves your employee’s productivity, level up your security, and establish long-term rapport with clients.
So, when searching for automated payment software, take your time. Do not take any shortcuts. Enjoy the process.
Without further ado, here are some factors to consider:
Know What’s Compatible with Your Current IT System and What Resources Will Be Required from Them
Suppose you have paid specific automated payment solution. Then, you realized that it’s not compatible with your existing IT infrastructure. That would be frustrating. So, before you stick to your decision, it’s better to do some research. Also, do not be ashamed to ask the company of your choice. There is nothing wrong with asking questions. After that, determine what resources you need to have.
Integrating a new system with a company’s current IT infrastructure is challenging. Whether you choose to install an on-premise solution to your server or the software requires multiple customizations, implementing a system will not be a good idea. AP automation solution in the form of a cloud service is more intuitive and easier to configure.
Audit and Compare Solutions
The quality of your customer experience is declining. Your employee’s productivity is decreasing. Or your payment security is reaching rock bottom.
If yes, you need to change and automate your payment procedure right away. Unfortunately, you cannot entrust your payment needs to a company that you do not know.
Take your time researching software trusted by many. Open Google and search for potential solutions. You can also take advantage of social media platforms, including Facebook, Instagram, Twitter, and LinkedIn. You can particularly join relevant groups. Then, read comments and ask questions.
After that, spend time comparing every available automated payment solution. The tool with all the features you look for is a better investment indeed.
Choose Automated Payment Solution that is Of Great Value
Who is not tempted to use a cheap automated payment solution? Every business owner wants to save some cash while taking their payment procedure to new heights.
But the quality of cheap payment software will not last. Invest in something that is of great value. But that does not mean you will try an expensive solution. Pick a platform that is competitively priced.
You have been using checks and other forms of traditional payment methods. But there’s a better alternative than that. Automated payment software is more convenient, safer, and easier to use.
The variety of choices, however, is complicated to narrow down. Worry no more. Prospero got you covered. Prospero makes the proposal generation process faster, more efficient, and more seamless than ever. It can be integrated with Freshbooks, Quickbooks and other third-party applications to make payments and invoicing easier.
So, what’s your thought? Feel free to visit the official website of Prospero for more details.
Streamline your payment procedure, and do not be left behind by your competition.