What is accounts payable automation?

Manual processes cost businesses more than just time. Between chasing paper invoices, mailing checks and fielding vendor inquiries, accounts payable teams are often stuck in a cycle of inefficiency that drains productivity and increases the risk of errors or fraud. As businesses grow and financial demands become more complex, automating AP is a strategic move that can help streamline workflows, reduce costs, strengthen compliance and unlock the full potential of your finance team.

What is AP automation?

In the simplest terms, automating the Accounts Payable (AP) process means using technology to accomplish time-consuming processes that were previously done manually.

Benefits of AP automation

By automating the payment process, there is no longer a need to manually enter data, verify its accuracy and be concerned about physical storage of financial paperwork. Plus, there’s no longer the need to rely on mail service for payments, eliminating the risk of lost or stolen payments or more seriously, mail fraud.

Furthermore, reducing paper, streamlining and automating the accounts payables process helps companies stay on top of compliance requirements, which can increase supplier and employee satisfaction and even help prevent audits and security breaches.

Accounts payable automation also involves the ability to offer additional payment options, including electronic payments. Delivering more payments electronically reduces the number of vendor inquiries on payments that are lost in or stolen from the mail. Often, increasing the number of payment options can result in an increase in manual processes. However, utilizing accounts payable automation tools can make the process more efficient through secure data management and payment automation.

In addition to these external benefits, there is the added bonus of freeing up the accounts payable team to focus on higher-level tasks such as reporting and data analytics and spending less time on repetitive, lower-level activities.

Despite the win-win elements of accounts payable automation, many AP teams face pushback when it comes to changing systems or lack the budget to automate.

Is AP automation right for your business?

When the majority of accounts payable tasks are done manually, businesses lose time and focus and increase the risk of human error (and the liabilities and losses that can come with it).

Businesses seeking to reduce AP processing costs can look to automation as a cost-effective solution. Approvals and routing processes are easily automated and the benefit of doing so is quickly evident.

Reducing the number of people needing to be involved in processing not only helps reduce the potential for human error but can also speed the process and increase AP effectiveness.

In addition, many leaders and executives now request quarterly or even monthly analytics and reporting. The reports and analysis available through AP automation tools make this an easy request to fulfill.

AP automation questions to ask with your business in mind 

If you find yourself answering “yes” to any of the following questions, it may be time to consider swapping out manual processes for AP automation.

• Does your business spend a significant amount of time on AP data entry, check printing and mailing and manually reconciling payments?
• Does your AP team frequently field questions about payments?
• Are your AP processes tracked manually?
• Is time spent with a supplier primarily focused on gathering payment preferences, sensitive banking information and fielding queries about invoicing and timing?
• Are the majority of your AP documents still physically mailed, filed and stored?
• Has your business experienced check fraud?

AP automation is a smart, safe way to help manage your business’s financial operations. By helping reduce manual tasks, minimize the risk of fraud, strengthen compliance and enable electronic payments, AP automation helps your team work faster, more accurately and more strategically.

If your organization is spending too much time on data entry, resolving payment issues or managing paper processes, it may be time to rethink your approach. The right AP automation solution can help you boost efficiency, gain better insight into your cash flow and empower your team to focus on high-value work.