Features of AR Automation

accounts receivable automation

Do you know the benefits of accounts receivable automation? Conventionally, a bank lockbox has been used by organization Accounts Receivable departments to increase expediency.

Lockboxes have been around for a while now and much of the traditional bank lockbox's lifespan has been utilized for processing payment data 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 use the bank lockbox to receive check payments in one consistent location.

Bank lockboxes are purposefully placed in a central location to reduce mail delivery time, which also assists with lowering the company’s Days Sales Outstanding (DSO). Banks get the paper check, process it along with the remittance data and send the information back to their client. 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 usually a monthly fee along with a per line remittance data processing cost. To process a large number of checks over time can be expensive with a lockbox.

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

Shortcomings of a Traditional Bank Lockbox



The lockbox could be somewhat high priced . Banks generallyearn a monthly fee in addition to a per line fee connected tohandling payment remittance detail .

Lockboxes can contain security concerns . The standard bank lockbox still takes a fair level of manual re-keying data . With read more the majority of manual data entry attendance being entry level-administrative workers who are new to the financial institution or an outsourced service provider . The details from the lockbox gives you all essential elements to produce a fraudulent check .

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

Commercial Bank Lockboxes Are Creating issues for your Customers' AP Department . Businesses are modernizing their AP Department to remove manual process and deciding 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 aidthose companies in an economical scalable solution for automating Accounts Receivable .

Pros of a FinTech Lockbox
Reduction Cost


The main objective of the FinTech Lockbox is to decreasefees per transaction and produce an Accounts Receivable automation program to allowbusinesses to QUICKLY clear cash and improve access to your working capital .

Simple payment trail
It is easy to track incoming ePayments from one location. Rather than flipping through remittance emails or going to the vendor portal click here to get payment data . The AR Lockbox gives you a single place to hold All of your incoming electronic payments meant for faster cash application .
Eliminates mail float
Mail float is a term for the time needed for a check to go from the payer to the payee by way of the postal service . With the rise in B2B payments electronically , mail float is rapidly becoming a productof the past . The increase in electronic payments choosing FinTech Lockboxes with a significant focus on the rate reduction and speed at which you clear cash and apply it to your working capital .


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