Finance and Accounting

Five accounts payable trends to optimise invoicing

Traditional accounts payable (AP) cycle is a tedious process. Receiving the invoice, recording it in the ledger, approving the payment, and closing the cycle manually can take up a lot of time. This process is not only time-consuming and error-prone but also leads to companies missing out on early-payments discounts. Additionally, invoice coding for non-PO invoices requires considerable effort and institutional knowledge.

With enterprises worldwide rapidly moving towards a digitised and streamlined system for managing their operations and payments, AP solutions are also witnessing a paradigm shift in 2021. Thanks to these technologies, businesses worldwide are making faster, smarter decisions and witnessing higher efficiency.*

Capitalising on the current AP trends and upgrading your existing system can work wonders for your business. Let’s look at the top 5 AP market trends you must incorporate to improve your efficiency and profits.

Want your business to fly? Take it to the cloud!

Having a cloud-based system reduces the cost and time involved in setting up hardware infrastructure. A cloud-based invoicing system allows employees to receive, edit, and approve AP payments from anywhere.

Cloud-based AP cycles enabled accounting and finance teams to work remotely with high efficiency during the pandemic. It is unlikely that the usage of remote invoicing systems will reduce anytime soon. On the contrary, we may witness more companies migrating to cloud-based invoicing cycles.

Artificial intelligence is real

Machine learning and artificial intelligence (ML/AI) are among the most trending AP automation trends. From spotting duplicate invoices to managing your ledger, automation has significantly improved the AP cycle. Automated bots can also set reminders, schedule payments, and route the invoice for approval, thus eliminating the need for a separate scheduling software. As AI and data science continue to grow, we are witnessing AP software packages with data mining, analytics, meta-tagging, and tracking features.

An ML-/AI-based analytics software can help you make smarter decisions during expense projections, spend analysis, payment follow-ups, and strategic sourcing.

Mobile access and data capture

Businesses worldwide are using smartphones and tablets to manage their business operations. Current statistics show that 90% of internet users use a mobile device to go online. Mobile-based apps can scan QR codes on invoices, add AP data to the central ledger, and improve vendor communication. Capturing data through handheld devices can also significantly reduce reliance on hardware infrastructure, further reducing capital costs.

e-Invoicing and online bill generation

Paper invoices will continue to reduce as experts have predicted that the e-invoicing industry will grow at a compound annual growth rate (CAGR) of about 20% and reach a market volume of $20.5 billion from 2019 to 2026. With an online invoicing system, you can log in to your business’ website remotely, reduce printing costs, and enable faster payments. Maintaining e-invoices online in a database can eliminate the need for storing physical invoices and reduce the risks of losing important documents.

Liquidity for fluid business operations

The recent pandemic showed how cash reserves are an indispensable part of any organisation. As liquid funds help businesses get through bad periods, it is likely that companies will build up their cash reserves to prepare for unforeseen dry spells like the COVID-19 pandemic.

With businesses trying to improve their liquidity, you can expect companies to prioritise the conversion of AP into cash. We may witness improved B2B payment management systems, which can improve the cash flow. As businesses are trying to quickly bounce back and recover financially from the economic impact of COVID-19, there is an increased dependency on automation. Digital tools like automated AP systems can streamline your invoicing process, reduce errors, and help your business get back to its feet faster. Incorporating innovative technologies can help you stay ahead of the curve and thrive among your competitors.

How can Infosys BPM help?

The Infosys BPM Accounts Payable on Cloud (APOC) platform has been designed from our rich experience of providing AP services to 75+ clients worldwide and handling over 22 million invoices annually, as well as combining the best-in-class technologies available in the marketplace. The platform combines best-in-class technologies and AI/ML algorithms to create a single layer of engagement for all invoice processing needs. APOC replaces redundant processes, eliminates fragmented tools, and provides real-time insights to stakeholders.

*For organisations on the digital transformation journey, agility is key in responding to a rapidly changing technology and business landscape. Now more than ever, it is crucial to deliver and exceed on organisational expectations with a robust digital mindset backed by innovation. Enabling businesses to sense, learn, respond, and evolve like a living organism, will be imperative for business excellence going forward. A comprehensive, yet modular suite of services is doing exactly that. Equipping organisations with intuitive decision-making automatically at scale, actionable insights based on real-time solutions, anytime/anywhere experience, and in-depth data visibility across functions leading to hyper-productivity, Live Enterprise is building connected organisations that are innovating collaboratively for the future.