What Are Integrated Payables? How It Works and Benefits

The use of ePayables and virtual cards for B2B https://www.garydawsonlaw.com/10-best-call-center-software payments is growing, and they are quickly becoming an alternative to checks and ACH in the accounts payable payments process. A 2021 study by Juniper Research predicts that the global value of virtual card transactions, including ePayables, will grow from $1.9 trillion in 2021 to $6.8 trillion in 2026. And a 2022 report by PYMNTS.com indicates that 55% of CFOs now use ePayables more frequently, and 40% have reduced their paper check usage. No, ePayables are not the same as ACH payments—while both are digital, they use different technologies and offer different levels of control and security. ACH (Automated Clearing House) payments are direct bank-to-bank transfers, whereas ePayables typically use virtual credit cards issued at the time of invoice approval.

Better Cash Flow Management

As more businesses look to make the move to AP automation and automating the accounts payable process, ePayables will become more common. The introduction of credit cards allowed businesses to pay for items without the use of either. Incorporating a flexible ePayables solution into your payment continuum is paramount to expanding into strategic- and higher-spend categories, achieving enterprise-wide goals.

• EPayables are processed like card payments and are subject to standard merchant pricing.
• Choose epayables software that can grow with your business and accommodate changing transaction volumes.
• Digital payments means that there are no physical items to steal, easily traceable digital audit trails, and the ability to expire once the payment has been made to the recipient.
• Moreover, they offer additional controls, but typically not as much process savings as P-Cards.
• For example, Stampli Card lets you assign spending limits by the cardholder, category, or other criteria.
• The future of ePayables includes AI-driven automation, seamless ERP integration, and global payment capabilities.

Company

At this point, the payment hasn’t been made as the vendor still needs to process the payment in their payment processor. The invoice is received through your typical workflow (usually by physical mail or email). Once received, the AP ePayables team does its typical invoice processing, getting sign off from the applicable stakeholders before marking it as approved for payment.

What is the difference between integrated and non-integrated payment?

They process the payment exactly as they would with a credit card receiving their payment in full and bringing the virtual card balance down to zero. EPayables are safer and faster than checks, using virtual cards to protect your payment information. One example of this is straight-through processing (STP) which requires no action from the supplier. With a virtual account, the buyer assigns a virtual payment card to a specific vendor or department.

• The virtual card doesn’t carry a balance, it only draws funds from the assigned bank account when approved by the AP team.
• Where integrated payments centralize multiple payment methods to improve internal efficiency, embedded payments are built directly into customer-facing platforms, so end users can complete transactions without leaving the app interface.
• Prior to founding AmeriQuest, Doug was President of Amtralease, a national association of independent full service truck leasing companies.
• In contrast to cards used by consumers, commercial cards are charge cards used in the business world to pay for business expenses.

These are some of the areas where ePayables hold distinct advantages over P-cards. First and foremost, ePayables come from one account, not multiple accounts that must be funded separately. Invoices are only paid after the purchases are approved, even if that process is automated somehow. Businesses around the country are beginning to realize the exorbitant cost of relying on traditional paper checks for invoice payments. Other products and services mentioned may be offered and marketed by other MUFG entities. Epayables automation refers to the use of technology to automate the management and payment of supplier invoices.

Invoice processing, supplier payment processes, processing costs, purchase order matching – all of it can be made faster, more reliable, efficient, and with minimized errors and exceptions. The fastest-growing segment in the world of commercial card payments instruments is ePayables, especially in the realm of cross-border payments. This virtual card payment offers operational efficiency and flexibility for both buyers and their suppliers. It also presents a lucrative opportunity for banks that support such programs.

Reducing Manual Tasks

Using a virtual credit card can help reduce fraud risk since it prevents the sharing of your actual credit card details with suppliers. If the virtual credit card is compromised, it can be easily canceled without impacting your credit or other pending purchases. Comparing these payment dynamics and expenses across card-based payments versus other payment methods, buyers can begin to lay out a much more promising picture with targeted suppliers. However, there are two limitations to using a virtual card for invoice remittances. They can only be used for online or phone transactions, so it’s not the right form of payment for all B2B scenarios.

EPayables use virtual cards and are designed to replace outdated payment methods like paper checks. Think of these virtual cards as digital credit cards built for business-to-business (B2B) payments. Providing a streamlined supplier experience – one where payments area easily traced and done in real-time – makes supplier part of your business network rather than just a counterparty in a b2b transaction. CFOs have expressed increased interest in adopting electronic payment methods, with 47% saying that increased efficiency was driving their decision to move to retained earnings balance sheet automated payment solutions. According to a 2021 survey of AP departments by Stampli, 61% of companies make virtual card payments, and 63% have a program to convert suppliers to accept virtual payments. Virtual card systems automate and replace inefficient manual processes by integrating directly with your ERP and accounting systems.