As organizations continue to modernize their financial operations, B2B digital payments are becoming a critical component of improving cash flow, efficiency, and business performance. While much attention is often placed on the payment transaction itself, the broader accounts receivable and cash management processes surrounding those payments can have an even greater impact on an organization’s financial health. Research highlighted by BlueSnap shows that outdated invoicing and payment collection practices continue to create significant challenges for businesses, including delayed payments, inaccurate cash flow forecasting, and increased operational costs. As a result, companies are increasingly investing in automation and digital payment technologies to streamline processes, improve working capital management, and create a more agile foundation for future growth.
Digital payments involves a lot more than just initiating the payment type, since things happened before that and some more things will happen after this action. Some entity will eventually receive the payment and have to do something with it.
In this posting at Cision PR Newswire, offered up by BlueSnap, a Massachusetts-based digital payments platform provider, the focus is on accepting various forms of digital payments using automated processes and accrued benefits thereof. Reference is also made to a downloadable survey summary conducted during the past six months.
‘More than 80% of businesses say the future of their company is threatened by late payments, a result of outdated accounts receivable (AR) processes, according to a new report from global payment technology expert BlueSnap….The new research reveals that current AR practices are impacting cash flow, human resources and customer retention while also being a drain on senior executive time within B2B businesses….The BlueSnap Progressing Payments Report found that 93% of organizations experience negative consequences due to their current approaches to AR, with more than a third (37%) unable to forecast cash flow accurately….On average more than a quarter (27%) of customers exceed their payment terms, resulting in 30% of an organization’s monthly revenue being tied up in AR. This is such a major issue that 81% of businesses agree that the future of their business is threatened by a lack of cash flow, brought on by overdue invoices.’
We recently released member research on the benefits of digitizing cash cycle systems and operations. There is the obvious cost efficiency gained by eliminating manual effort and all the errors that accompany such processes. However, the real gains are in better working capital control, improved transactional speed across the supply chain, and resulting cash flow improvements.
This has been especially valuable during the pandemic but is a regular feature at the best-run companies, especially those that take an end-to-end approach to reviewing financial operations across the organization. Survey results might also be interesting to some readers so worth taking a look.
Respondents recognized the need for change – 95% thought they should be investing more in AR automation and payment technologies, with predicted benefits including improved cash flow (32%), better forecasting and planning (30%), and reducing late invoices (27%).…However, they also saw the opportunity for increased growth – 28% believe it would give their organization the ability to invest and grow, while 25% linked AR automation to winning more business from existing customers. … “As more and more businesses digitize their entire organization, and the lines blur between markets, those companies that can react quickest will be the ones that succeed,” explained Dangelmaier. “That means automating as many processes as possible. This is the only way they can cut the opportunity for error, improve overall accuracy and access the data they need much faster. In doing so, they can understand how much cash they actually have and see where the opportunities for investment and growth lie.” ‘
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
