Cutting-edge technological advancements help companies to optimize their accounts receivable.
FREMONT, CA: Globally, the current outbreak has had devastating economic effects. Due to the difficulty of managing the AR process in this work-from-home scenario, small and medium-sized businesses (SMBs) are experiencing a cash crunch that has a negative impact on revenue cycles, working capital, and cash flow. In order to strengthen AR processes and ensure future growth, companies are obliged to reconsider and reorganize their company strategies. In this cash-strapped environment, digital transformation has been a lifesaver. Due to financial restrictions, businesses are delaying their automation plans.
What are the benefits of leveraging technology to optimize AR?
Businesses are looking for integrated solutions that may help boost the operational effectiveness of back-office AR procedures because of the growth opportunity this crisis has presented. A successful company plan today includes digital transformation in the financial sector.
Real-time cash reconciliation: Due to paper-based AR processes, most mid-sized organizations suffer from manual balancing. To achieve same-day cash posting, organizations can use automation to automatically aggregate remittance through various channels like email, web portals, and EDI, as well as map invoices with payments. Doing away with lockbox key-in fees, it would also get rid of human mistakes and cut costs.
Mitigating credit risk and enabling faster onboarding of customers: Businesses take a long time compiling financial data from many sources to determine a customer's credit score, which delays the enrollment of new consumers and causes orders to be denied. You may enroll clients more quickly, execute a regular review on time, handle blocked orders with just one click, and more with the introduction of intelligent automation in credit management.
Making collection process proactive: In order to update with at-risk client funds and reduce the Days' Sales Outstanding, automation enables you to construct a prioritized worklist with reference materials for analysts. In addition, tools like automated correspondence and a common repository for backup papers could support the collection team in developing proactive collection plans.
Early dispute identification and resolution: Without automation, businesses spend a lot of time acquiring information and supporting materials to determine whether a dispute is valid. Utilizing automation makes it possible to automatically aggregate all backup papers to verify the accuracy of the deduction claim, lower bad debt, and increase customer trust.
Highly accurate cash forecasting: The presence of an accurate and reliable cash forecasting process has a positive impact on the working capital of a business. It provides end-to-end control and visibility of the AR to allow the business to become more efficient regarding how they manage cash.
