Gain AP efficiency and scalability: Expert automation strategies

With growing payment modalities and complexity, the need for efficient and secure automation is more critical than ever. In a recent Deluxe Exchange session, "Payments Built to Scale: AP Automation Strategies to Succeed," payment experts provided valuable insights into how banks can leverage AP automation solutions to streamline their accounts payable processes, reduce fraud and improve overall efficiency. 

Understanding common pain points

Steve Buchberger, executive director and head of Payables and Partnerships at Deluxe, kicked off the discussion highlighting the three primary challenges today in AP automation: manual processes, fraud and managing vendor information. These pain points are common across businesses and banks of all sizes, with 75 percent of respondents stating that reducing manual processes would “solve a significant pain point,” according to the 2024 Deluxe AP Automation Readiness Research report.

Significant barriers to payables automation:¹

• 58% IT availability or priorities
• 49% System limitations or restrictions
• 28% Management priorities
• 26% Available capacity of payment staff 

Strategy #1: Understand your clients' automation needs

Simply put: AP automation solutions can significantly reduce the manual effort involved in processing payments. By automating routine tasks, businesses can minimize errors, save time, and enhance accuracy. Karen Nielsen, EVP and Division Manager at Zions Bancorporation, emphasized that AP automation is not just a technology but a journey. It involves understanding your client's current state, their ultimate goals, and partnering with them to achieve those goals incrementally.

Pat Kelly, Vice President and Product Manager at BankUnited, agreed that understanding your customer’s automation needs is important. Furthermore, choosing a solution that meet your clients’ needs with minimal disruption to their existing processes can help to increase overall efficiency without additional implementation obstacles. 

Strategy #2: Simplify payment complexity

As the payments environment grows even more complex, how do you simplify the process? One of the key themes of the session was the complexity of the payment environment. With the introduction of new payment rails like RTP and FedNow, businesses are overwhelmed with the changes and the need to gather new types of information.

“AP automation really helps the client remove the friction points in their payment process,” says Nielsen. “What we hear from our customers is that there’s so much rekeying of information to get from their accounting system or their ERP to the bank systems and initiating those payments.”

AP automation solutions can help simplify this complexity by integrating various payment modalities and reducing the friction points in the payment process. For example, Nielsen suggests setting up file transmissions or creating import batches within digital banking platforms to help streamline operations for their business customers. 

Strategy #3: Help reduce fraud risk with client education

Fraud remains a significant concern for businesses, especially with the rise of sophisticated schemes and BEC targeting payment processes. To help reduce the risk of fraud, Nielsen and Kelly highlighted the importance of client education and the implementation of robust fraud prevention measures. Simple solutions like enrolling in payee positive pay can make a substantial difference. Additionally, advanced services like account verification and business networks that exchange legitimate payment information can further enhance security.

Strategy #4: Facilitate client implementation and adoption

Successful implementation of AP automation solutions requires a strategic approach to client engagement and adoption. Kelly shared that highlighting the value proposition of these solutions—such as time and cost savings and fraud reduction—is crucial in gaining client buy-in. Overcoming clients' aversion to disrupting their processes or paying for new services involves demonstrating the tangible benefits can be a challenge.

Nielsen adds providing tools like ROI calculators to quantify the value, as well as having a client success team or strategic solutions role in place at the bank, can help drive adoption: “There’s an opportunity for banks and financial service providers to help clients bridge more of that technology gap.”

By addressing pain points, simplifying complexity, preventing fraud and ensuring successful client implementation, FIs and businesses can unlock significant efficiencies  and enhance their payables processes. Businesses and banks can stay ahead with innovative AP automation solutions and stand out from their competitors.