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8 mins read

Payment Automation

Man-Machine Mindmeld: The Optimal Invoice Payment Process

by Yooz on 09.28.2021

Invoice Payment Process

Getting invoices paid on time is hard. Envelopes, emails, faxes and -- depending on the size of a company -- electronic invoices stream in that need to be processed, entered into the accounting software of choice and then reviewed, approved and finally paid. 

Errors, exceptions and inquiries can hold up this workflow at any time. Even if all the details check out, the last and final step of initiating payment is an unnecessary obstacle for many companies. They have partially gone digital but still, end up cutting checks. The solution to streamline the entire process is payment automation.


Nothing has made this innovation gap more obvious than the shocks of the pandemic. COVID rattled the accounts payable system in the vast majority of organizations unless they had already completed their digital transformation. Workers were forced to stay home, invoices piled up in deserted offices and were processed late and therefore paid late, plus vendors ran into serious cash-flow problems that reverberated throughout the entire supply chain or, in the worst case, put them out of business. 


Total Recall Thanks to a Digital Invoice Payment Process 


When we surveyed more than 1,000 finance leaders in the US and seven other European countries back in March to report on the “State of Automation in Finance,” 80% admitted that one of their biggest challenges was to process and pay invoices on time. Simply put, they lacked a system that empowers them with an optimal invoice payment process. 


Automating the workflow from purchase to payment with an intelligent platform in the cloud eliminates those challenges. It’s designed to catch errors, approve and pay on time, lock in discounts and make the entire organization resilient, no matter what the outside world throws at you. 


Piecemeal solutions that tackle only parts of this workflow, on the other hand, affect an organization’s competitive position, now more than ever. If 2020 was the year of disruption, 2021 is the year for a fresh start to future-proof an organization with cutting-edge digital tools.  


A cloud-based platform such as Yooz with its latest add-on YoozPay can make a tangible difference between struggling to pay invoices on time or always being on top of things. It puts the power of robotic process automation (RPA) and machine learning algorithms in the hands of the accounts payable team so humans no longer have to deal with the tedious details. 


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Intelligent payment processing means machines do the menial work


Instead, they set the parameters once and let machines do the menial work. This man-machine mindmeld allows the accounting pros to focus on high-value tasks such as reviewing exceptions, optimizing cash flow based on real-time data and using those insights to maintain good relations with their suppliers. This kind of straight-through processing with as little human intervention as possible provides unmatched speed, security and savings, all the way to getting payments out. 


YoozPay was purpose-built to streamline the last step in the purchase-to-pay process. As market researcher Ardent Partners reports in its most recent “State of ePayables 2021” report, B2B payments are still holding up progress in many organizations to achieve operational excellence. “Automation of the B2B payments process has often been described as the gateway to the next frontier in an AP transformation and is finally beginning to get the attention it has deserved.” 


While 51% of companies surveyed told Ardent that they had B2B payment automation in place, that’s only half the truth. Most of those companies have the process only “somewhat automated,” meaning that only 41% have payment scheduling truly automated and just one-third have the payment execution fully automated. There is clearly room for improvement.


B2B payments still lack cutting-edge invoice payment processes


Here’s how Ardent summarizes this critical challenge:


“In order for AP to become a truly strategic business function, B2B payment automation is critical. In many ways, AP and Treasury have similar goals. Both want to maximize their strategic value to the organization, while also driving any possible cost savings. Add to this AP’s position in the organization as a cash-distribution function (frequently the largest non-payroll source of cash outflows), and it becomes clear that the two teams need to collaborate in order for both to succeed. If Treasury and AP can work together effectively, then the enterprise at large can pay its suppliers more intelligently, gain improved cash forecasts, and have a much more complete picture of its financial risk exposure. These goals are both laudable and important, but only attainable with electronic payments in place.”


So what does the optimal invoice payment process look like? It can be broken down into the five steps of capture, review, approve, pay and export. Let’s look at the first three before going into the details of how to supercharge the payment step.  


As a cloud-based platform, Yooz can be up and running in under an hour and will correctly capture more than 80% of all incoming invoices without any prior configuration. Regardless of the format, from good old paper invoices and faxes to emails and electronic submissions, Yooz ingests all documents within seconds and then uses RPA and constantly updated machine-learning algorithms to extract the relevant information and correctly GL-code it. 


Since Yooz has been innovating in this space for more than decade, the platform has an unrivaled and steadily growing data set to learn from. Our algorithms have processed more than 100 million purchase orders and invoices from more than a million different vendors, getting better one document at a time. Unusual formatting or idiosyncratic templates are not obstacles but a valuable learning experience for the platform. Since this constantly updated firepower in RPA and machine learning resides in the cloud, customers can be sure to always have the latest capabilities in purchase-to-pay automation at their fingertips. 




Nix fraud and errors with an intelligent invoice payment process 


Review is the crucial phase when dates, account numbers, invoice amounts, PO numbers and other details are not only indexed but also cross-matched three ways to make sure duplicates, erroneous and outright fraudulent invoices won’t slip through the cracks. According to Ardent, 38% of all companies they surveyed reported payment fraud attacks in 2020, a record high due to the mess created by disrupted workflows and remote work arrangement. A platform like Yooz can significantly reduce processing errors, whether they are intentional or by accident, again lightening the staff workload.


Dealing with exceptions has plenty of hidden costs beyond double or false payments, reports Adent. “The amount of staff time dealing with invoice exceptions is costly, but it also delays payments, disrupts cash flow, and keeps the AP team from focusing on higher-leverage/more strategic activities.” 


Review and approval are sped up significantly with intelligent automation. Yooz routes invoices to the right person or multiple recipients in the right order and enables managers to approve an invoice from anywhere, anytime. Work-from-home mandates and other disruptions are no longer an obstacle since the all-important click can now happen from a mobile device. Since all documents are indexed and securely stored in the cloud, authorized staff can perform keyword searches for particular invoices as easily as if they were using their favorite search engine. 


YoozPay makes invoice payment processing a snap


And now comes the payment part. 


Consumers have long been enjoying the convenience of lightning-fast payments with the payment method of their choice, but businesses are just beginning to discover the many advantages of having a lean digital invoice payment process. 

YoozPay is the latest add-on to the Yooz platform, designed to take the guesswork out of this step. It offers the simplest and most flexible automated digital invoice payment workflow in a single and intuitive user experience. AP teams can use the same browser or mobile interface they already know to schedule and execute payments to vendors in three simple steps. 


Once they choose the parameters for a supplier, Yooz automatically handles the rest. And does so with unmatched security, since it has fraud detection built-in at every level of the transaction process, protecting both parties with limits and velocity checks and using pattern checks for additional fraud control. 


AP staff only has to select an approved invoice, specify the full or partial amount to be paid and select a payment method. Things are also as easy as can be on the vendor side. A supplier can now be onboarded and paid with a single email address and one click to choose their preferred payment method, ranging from check or electronic check to virtual credit card, which is the fastest and most secure way to get paid. 


Make money on every invoice: invoice payment processing with cashback 


YoozPay uses those settings to automatically pay single or batches of invoices, following an automatic or manually defined payment schedule. If a vendor selects to be paid by virtual credit card, the payment is executed instantly. Purely digital credit cards come with several benefits. They provide increased security and fraud protection and create a more granular audit trail since a business can create individual (virtual) credit card numbers for vendors, projects or other categories. Last but not least, virtual credit cards generate a recurring revenue stream in YoozPay through valuable cash-back for each invoice paid. 


Those savings add up quickly. Let’s assume a company is processing 500 invoices a month or 6,000 a year with Yooz. That way, it already saves close to 5,000 in annual processing costs compared to traditional, more labor-intensive methods. Add the virtual card option offered in YoozPay, and you’re looking at additional revenue of several thousand dollars through automatic cash-back. 


Transforming your invoice payment process with Yooz turns the AP function from a cost center to a revenue contributor and a value driver for the entire company. Not only does purchase-to-payment automation save money, it adds a new revenue stream that affects the bottom line, slashes erroneous and faulty payments and generates valuable financial intelligence for all departments. 


Boost competitiveness with a smart invoice payment process


It’s a treasure trove of data that sales, marketing and other parts of an organization can use to build better relationships with vendors, prioritize payments to key suppliers and negotiate more favorable terms that will have a long-term effect on profitability and competitiveness. 


The last and final step in an automated and intelligent invoice payment process is also a piece of cake. Yooz plus YoozPay plays well with more than 250 of the most popular financial software, ERP and DMS systems. Once an automatic payment goes out, it pushes the information to your accounting system of choice and marks the corresponding PO as paid. 


In short, YoozPay is a major step forward toward intelligent B2B payment automation. Forget about “In” and “Out” trays and checks. Take the leap to harness the power of a perfect man-machine mindmeld and experience how YoozPay literally pays for itself. 


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The State of Automation 2021 ressource center

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The State of ePayables 2021 Report