Written by: Erin Wright
Electronic payment methods and channels have continued to increase in popularity as customers drive the demand for more convenient, secure and contactless ways to make payments. According to a 2022 AFP Survey, 73% of organizations are transitioning their B2B payments from paper checks to electronic payment methods.1 This adoption of electronic payments is being driven by a number of factors, including businesses’ need to improve operational efficiency and security, and customers’ desire to have more robust and convenient payment options.
Nevertheless, paper checks still remain a foundational payment method in back-office payment processing operations with 81% of B2B payments still being made by check.2 Businesses are now having to manage multiple payment methods—paper-based and electronic—across multiple payment channels. In order to successfully manage this new payment environment, accounts receivable (A/R) automation solutions can deliver the ability to accept any payment method, from any payment channel, and seamlessly post the transaction details to any back-office system—all from a single, secure, cloud-based platform.
Understanding Customer Payment Preferences
The most popular way for customers to make a payment on their account is via a self-service online payment solution through a business’s website.3 Convenient, contactless, self-service payment options have proliferated across the B2B payments landscape over the past several years–largely due to the hyper disruption brought about by the COVID-19 pandemic.
Customers have become increasingly accustomed to the ability to make payments whenever and wherever they want. With online payment acceptance solutions, businesses are able to deliver customers with the tools to securely make credit/debit card and ACH/EFT payments online to outstanding invoices/statements, view past payment history and store payment methods for future use.
In addition to self-service online payment options, customers also prefer to make payments via automatic payment solutions. With automatic payment (AutoPay) solutions, businesses can streamline the payment acceptance process by offering seamlessly automated ACH and credit/debit card transactions.
Autopay solutions allow organizations to set-up recurring payments on a customer-by-customer basis—with the added benefit of proactive payment reminders detailing the payment information and upcoming draft dates. These reminder emails contain essential information, such as the number of invoices to be paid, their respective dates, and payment amounts, ensuring a smooth and transparent payment experience for both businesses and their customers.
Mobile payment solutions have also evolved during the shift towards electronic payment methods and channels. Mobile payments have moved beyond being solely a consumer-focused payment channel, and are now making significant inroads within B2B receivable operations.
Mobile payment acceptance solutions enable businesses’ sales representatives, field team members and delivery drivers to accept payments on the spot—all from a single application, either stand-alone or embedded within an existing app. Additionally, mobile payment acceptance solutions also offer advanced remote deposit capture (RDC) features to conveniently accept paper checks. With mobile RDC (mRDC), businesses can unlock the power of moving paper-based receivables from the back-office to the field and front-office.
With embedded payment solutions, whether utilized within a mobile application, webpage or other interface, businesses are able to seamlessly integrate payment acceptance technology within existing systems to enhance the customer payment experience. Embedded payments deliver a highly-configurable approach to the payment experience by aligning the payment acceptance technology with a business’s unique brand, processes and back-office operational workflows.
Consolidating & Optimizing Payment Processing Operations
With numerous digital payment channels expanding in popularity within the B2B payments landscape, businesses now have the option to deliver customers with the payment acceptance capabilities they need and want. According to a PYMNTS report, 22% of customers say that having a wide range of payment options is highly-desirable, and 82% of businesses expect that offering multiple payment options from a single system will improve A/R and collection efforts.3
However, many businesses are still utilizing outdated, legacy systems to manage their various payment methods and channels. With the increase in demand and adoption of electronic payments and the payment acceptance solutions that come with it, businesses are continuing to add disparate, siloed systems to their back-office receivable processing operations instead of utilizing a single, A/R automation platform to manage their entire receivable lifecycle.
Only 7% of businesses believe that their manual systems and processes sufficiently meet their A/R needs.4 And, 64% of CFOs state that they “definitely need” more automation within A/R operations and processes.5
With A/R automation software, businesses are now able to consolidate, automate and streamline payment acceptance, processing and posting from a single, cloud-based platform. By accepting any payment type (check, ACH/EFT, credit/debit card, cash) via any payment channel (mailed-in, lockbox, called-in, in-person, online, mobile) and automatically posting to any back-office system, businesses can manage payment processing and cash application operations from a single, cloud-based platform.
As the popularity and demand around electronic payments increases, and the usage of paper checks remains consistent, businesses are in a position where managing all incoming payments from a single place is a necessity. By empowering customers with the ability to make payments when and where they want, whenever they want, businesses are able to meet the increasing demand for secure, efficient and contactless payment options, while continuing to manage paper-based receivables in an effective manner.
From versatile online payments to configurable mobile solutions, seamlessly embedded payments, AutoPay solutions and more, the path to enhanced efficiency and streamlined back-office payment processing operations has never been more accessible. With robust payment acceptance and processing capabilities, automated cash application, and a focus on customer-centric payment experiences, embracing A/R automation is not just an option, it's a strategic move that positions businesses for success in the dynamic digital payment acceptance landscape.
1 AFP Survey, “Payments Cost Benchmarking” | 2022
2 PYMNTS Report, “Meeting the Growing Need for A/R Modernization” | 2023
3 PYMNTS Report, “Why Holistic Bill Payment Experiences Will Win the Payment Platform War” | 2023
4 PYMNTS Report, “Accounts Payable and Receivable Trends: The Journey to Automation” | 2023
5 PYMNTS Article, “Death by Paper Cut: The Hidden Costs of Checks” | 2023
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