The Association for Financial Professionals (AFP) released a report in last September that found the use of paper checks in B2B payments actually increased in 2016. Yet, that said, experts still expect reliance on paper will fall in this year, as reported in an analysis from NACHA, released last June, which finds that accounts receivables (AR) executives anticipate ACH payments to surpass the check by 2020.
That may be why 2018 may go down in B2B payments history as the year the space saw an increase in attention from innovators. B2B payments have found the spotlight as companies recognize immense opportunity to address key points of resistance, with Deloitte estimating global B2B payments to reach $23.1 trillion, by 2020.
What do you need to do to move forward and change your ways from checks and how to do find the right partner?
1. Calculate your Cost of Issuing Checks
Industry experts say that companies spend between $3.00 and $20.00 per check when calculating all hard and soft costs associated with check issuance. Conservatively, most agree that $5.00 per check is a fair cost.
Using this ROI Calculator sheet you may fill in details such as your total A/P spend, cost per check for your organization and number of checks per month to learn the potential impact of converting check payments to electronic payments.
On top of reducing check printing and mailing costs, you may even generate a new revenue stream by adding V-Cards to your payment mix. In most cases you will earn approximately 1% cash back on the dollars transacted on cards. Factor the rebates into the mix and you can end up with new monthly recurring revenue just for paying your suppliers.
2. Seek a platform that can move you to electronic payments for Accounts Payable and Accounts Receivable.
A/P and A/R automation software give your company the tools to swap the complexity and friction of paper-based payment processing for the efficiency and ease of a cloud-based, fully secure, web-enabled automated system.
CFOs who adopt A/P and A/R automation greatly reduce their costs yet gain the advantage of greater transparency to report on their CASH position. And, with A/R automation, they can actually put CASH to work more quickly allowing better CASH planning and management.
3. Know that ePayments and eInvoicing don't have to go hand-in-hand.
Accounts Payable Automation is a transformation that provides Finance departments with HUGE returns but doesn't have to come with enormous headaches, long projects and big expense up front. It can be paradigm-shifting after it's complete but it doesn't have to be before. Start by automating PAYMENTS to avoid the bigger headaches that come when attempting to migrate to eInvoicing.
Are you ready to stop using paper checks to make a move to ePayments?
To recap on why you should consider moving to ePayments: Easier than issuing checks, less costly, painless to covert, and there are no headaches up front. In addition, you can also earn cash-back rebates to turn your A/P cost center into a profit center.
What are you waiting for?