When AI is changing the world, why is data reconciliation stuck in the 90s?
When it comes to transactions between customers and third-party vendors, payment intermediaries play a very critical role. The exchange of merchandise and money between merchants and customers is a relatively simple process. Adding intermediaries, no doubt, will add an additional layer of complexity.
With intermediaries, each time a transaction is completed, a portion of the funds exchanged must be transferred to a multitude of third-party vendors. This is why efficient payment reconciliation is so crucial.
If a proper payment reconciliation process is not in place, it could lead to fragmented processes, severely affecting cashflow and process efficiency triggered by manual invoicing, clumsy manual data entry, can all prove to be rather costly for the business.
All these challenges underscore the importance of having a fully integrated and comprehensive payment system that can catalyze your business transformation.
Poor reconciliation equals revenue loss
Reports show that in the US alone, the cost of poor data reconciliation is more than 140,000 dollars. To manage the finances of a business that deals with high volume B2B transactions is dauting to the finance team, not to mention the huge loss of time.
Matching monthly accounts, identifying gaps, other discrepancies, if any, and taking effective measures to rectify these can be labor-rich and time-consuming.
Despite all these drawbacks of manual processes, many businesses still don’t automate the process, further exacerbating the problems.
This clearly explains why more than 87% of accounting professionals work overtime, especially during financial close hours, with 60% agreeing that the stress levels spiked during these hours.
Benefits of a powerful integrated payment system
Moving from excel spreadsheets to a completely integrated and comprehensive digital payments system or an ERP system has changed the game for many businesses that ventured to take the risk.
Advanced ERP or Enterprise Resource Planning solutions are feature-rich and offer vast valuable insights, and their full potential can be utilized only with an integrated payment module.
When you implement an ERP system with integrated payment module, you are consolidating incoming and outgoing transactions to one place. The smart solution will become the single source of truth for your business. It not only eliminates the massive task of manually reconciling payments, but will also save a lot of time, money and other resources that could easily be invested in other value-addition activities.
With automated processes, payment and data reconciliation becomes more streamlined, reduces errors and financial discrepancies, thus improving process and operational efficiency, and improved cashflow.
Automated reconciliation: Benefits
Automated reconciliation has the following benefits:
Data is critical in today’s digital world. Data drives major decisions. If a business’ finance team gets accurate data consistently, they can get actionable insights based on patterns. When such meaningful data is available at the fingertips of CFOs, and revenue management teams, it empowers them to make important decisions and allocate resources accordingly.
Time and money saved
There is no doubt that automated processes save a lot of time and money. Firstly, it eliminates labor-intensive tasks, making processes less error-prone, again eliminating the need for error detection and rectification. Thus, all the time and resources saved can be utilized to plan and implement strategic growth driving initiatives.
Implementing a seamless payment system will ensure friction-free business scaling, by eliminating bottlenecks and smoothening payment operations. All the time saved in payment reconciliation can be used to foster better customer relationships, explore new revenue opportunities, and expand business to new geographical areas.
Reports and Business Analytics
A powerful payment operation system with robust dashboard will give access to valuable data analytics, increasing the efficiency of the data reconciliation process. Finance teams and marketing teams can utilize these data to further optimize process and take informed healthy financial decisions.
It’s high time that businesses abandon clunky manual payment processing methods and embrace integrated and comprehensive payment systems to drive all financial operations. Exploring all the benefits of an integrated payment system, we now know that an intuitive platform can ensure seamless data reconciliation, access to actionable data insights, strong data reporting and analytics, and seamless business growth and expansion.