Features of AR Automation

accounts receivable automation

Are you familiar with the benefits of accounts receivable automation? Conventionally, a bank lockbox has been used by company Accounts Receivable departments to increase efficiency.

Lockboxes have been around for many years and a lot of the conventional bank lockbox's life has been used for capturing payment information associated with payments made by check. Big provided this amenity to improve effectiveness and flow of company transactions simplifying the accounts receivables collection method.

Clients generally leverage the bank lockbox to receive check payments in one consistent location.

Bank lockboxes are strategically placed in a central location to decrease mail delivery time, which also assists with lowering the business’ Days Sales Outstanding (DSO). Banks receive the paper check, process it along with the remittance data and send the information back to their customer. Because banks are processing checks and remittance this decreases the clients A/R workforce and increases their productivity. The price of the bank lockbox is typically a monthly cost along with a per line remittance data processing fee. To process a large number of checks over time can be costly with a lockbox.

Today, we see a huge shift with Accounts Payable Departments paying electronically. This shift to ePayments has revolutionized the FinTech trade with {solutions| designed with the goal of decreasing business costs of processing incoming payments.

Disadvantages of a Traditional Bank Lockbox



The lockbox can be somewhat high priced . Banks generallyacquire a monthly rate along with a per line fee associated withprocessing payment remittance detail .

Lockboxes may include security issues . The traditional bank lockbox still requires a fair level of manual re-keying information . With the majority of manual data entry attendance being entry level-administrative staff who are a novice to the bank or an outsourced contractor . The details from the lockbox more info gives you all required elements to create a fraudulent check .

Lockboxes don’t tie into your accounting system . Bank lockboxes process your payments and remittance data and thensend you the information . Your team still must key in that information into your ERP to clear the cash .

Commercial Bank Lockboxes Are Causing a Problem for your Customers' AP Department . Companies are modernizing their AP Department to get rid of manual process and preferring to pay their customers electronically via ACH , Credit Card or vCard . These preferred methods of ePayment are creating an increase in email remittance . FinTech solution businesses have bridged the gap to assistthose companies in a cost efficient scalable solution for automating Accounts Receivable .

Rewards of a FinTech Lockbox
Reduction Cost


The major objective of the FinTech Lockbox is usually to decreasefees per transaction and click here provide an Accounts Receivable automation tool to helporganizations to rapidly clear cash and improve access to your working capital .

Trouble-free payment trail
It is easy to track incoming ePayments in one place. Instead of flipping through remittance emails or heading to the vendor portal to download payment information . The AR Lockbox provides you with one place to hold ALL your incoming electronic payments created for faster cash application .
Gets rid of mail float
Mail float is a term for the time needed for a check to travel from the payer to the payee from the postal service . With the rise in B2B payments electronically , mail float is quickly click here turning into a productof the past . The increase in electronic payments choosing FinTech Lockboxes with an essential focus on the cost reduction and speed in which you clear cash and apply it to your working capital .


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