77% of CFOs Say AR Automation Improves Invoice Tracking

Many companies struggle with a lack of transparency in their accounts receivable (AR) processes, making it difficult to identify payment issues and forecast cash flow. As business operations become more complex, AR automation provides a solution.

The PYMNTS Intelligence report “Window of Opportunity: Gaining AR Transparency Through Automation” found that by adopting digital and automated processes, companies can close visibility gaps and build stronger relationships with suppliers and customers.

Lack of AR Visibility Impedes Companies’ Growth

One of the most pressing challenges businesses face today is the lack of visibility into their AR processes. Without real-time insights into cash flow, accounting teams often find it difficult to pinpoint the root causes of payment delays, inefficiencies and missed opportunities. This lack of transparency can undermine a company’s ability to make informed financial decisions.

Small- to medium-sized businesses (SMBs) are particularly vulnerable, with 59% citing cash flow forecasting as the top challenge when relying on manual AR processes. These businesses are also hampered by outdated systems, with half reporting they spend too much time on AR processing.

As businesses grow and their operations become more complex, the need for clear visibility becomes more critical. Automation offers a solution by providing real-time access to data, enabling companies to track payments more effectively and improve financial decision making.

Increased Transparency Leads to Better Buyer-Supplier Relationships

For businesses, transparency in AR not only improves internal operations but also strengthens relationships with suppliers and customers. Clear communication, facilitated by automation, helps both parties manage expectations, resolve disputes and build trust.

Buyers demand better visibility in the payment process. According to the report, 53% of heads of payment at middle-market companies want simpler payment processes for suppliers. Many buyers also desire more comprehensive information, with 37% seeking access to order status, order history and outstanding invoices. Similarly, suppliers seek greater communication, with 98% of them, emphasizing the importance of improved data accessibility from their buyers.

Increased transparency through automated processes can greatly improve collaboration. Self-service customer portals and automated communication workflows can provide buyers and suppliers with real-time updates, reducing misunderstandings and instilling long-term trust.

Automation Sheds Light on AR for Better Forecasting

AR automation brings visibility to cash flow and payment forecasting, reducing errors and delays in the process. The automation of invoice tracking allows businesses to streamline AR operations, reducing costly mistakes and improving cash flow management.

Automation reduces issues related to payments. According to the report, 77% of chief financial officers at large U.S. firms reported that AR automation reduces delays through improved invoice tracking. Furthermore, 85% of CFOs said automation helps address invoice errors and discrepancies, which can otherwise disrupt payment cycles and strain supplier relationships.

SMBs and large firms benefit from the improved visibility that comes with AR automation. These businesses can track invoices in real time, spot discrepancies earlier and process payments more quickly. As a result, they can better manage cash flow and make more informed strategic decisions. Businesses must embrace automation to enhance visibility and streamline processes. By digitizing payment systems, companies can reduce manual errors, increase forecasting accuracy, and build stronger relationships with customers and suppliers.