AI and ML can optimize traditional finance workflows in Account Receivables, Accounts Payables

Legacy finance workflows significantly impact the efficiency of finance teams. The long and repetitive tasks leave room for error and increases the turnaround time for payment closure for vendors. However, using technologies like AI and ML can enhance the finance management by automating repetitive tasks and narrow the gap for clearing DSOs. Global PayEX solutions aims to digitize Account Receivables, Accounts Payables automation through its SaaS platoform. Abhilash Edakadampil, CTO, Global PayEX in an exclusive interaction with CXOToday discusses the role of technology to automate AR/ AP processes, their solution offering and the emerging trends in B2B payments industry:

• How have enterprises used technology to optimize traditional financial workflows?

Technology has fundamentally transformed the way organizations function and operate. According to PwC, 60% of C-suite executives believe that digital transformation is their most critical growth driver in 2022. With this growing dependency and trust in the digital technologies to transform various functions, organizations are prioritizing use of technology to optimize performance and maximize growth.

Finance functions are important for business growth and success strategy. However, financial workflows typically use legacy systems which are slow, time-consuming and requires a lot of repetitive processes. Using technology to optimize traditional financial workflows including automation of Account Receivables, Accounts Payables, Invoice processing and presentment, etc. can significantly reduce time, eliminate repetitive tasks and enable businesses to grow and scale.

• How does the application of AI/ML in Accounts Receivable /Accounts Payable make financial workflows more efficient?

While organizations have put digital transformation on their agenda, they are still struggling to handle the large amount of unstructured data resulting from their technology applications. AI/ ML is an enabler to derive actionable insights from by processing this raw data and help finance teams to create efficiencies in the AR/ AP automation efforts.

Organizations can enhance their AR/AP processing using as assist in identifying information from businesses like purchase orders, invoices faster than the finance staff and process them more quickly with the help of specific algorithms and optical character recognition (OCR) software. While reducing processes, improving operations, and fundamentally changing business, the AR/ AP may use AI to drive innovation, collaboration, and growth across all business areas

Moreover, AI has the ability to automatically set spending caps, notify approvers, provide authorizations, and even match POs for improved processing. AI and ML can improve accuracy, reduce errors, avoid fraud, save costs, helps in faster resolution of disputes and improve financial health of an organization.

• How is Global PayEX using AI/ML in their solutions to make financial operations more efficient?

We at Global PayEX offer organizations with a cloud-native, data-driven SaaS platform to optimize working capital by automating AR/ AP transactions. We have partnerships with several leading global, regional banks and has a marquee customer base across Fortune 500 companies.

Reconciliation (cash application automation) and electronic invoice presentment and payment (EIPP) are Global PayEX’s two primary digital platforms for account receivable (AR). Customers can examine invoices and credit/debit notes, make payments and deductions, view statements, and automate the accounting entries submitted to the seller’s ERP by using the EIPP platform, Freepay. Whereas AlgoriQ, a platform for reconciliation, automates the reading of documents such bank statements, remittance/payment advice, and reconciliation while also automating posting to the ERP (automated accounting). AlgoriQ aids in the detection, tagging, and resolution of end-user deductions.

We also offer a vendor portal for suppliers and vendors to see documents such purchase orders, goods receipt notes, and payment advise for accounts payable (AP). Our platform also makes it possible to process invoices by automatically reading invoices in a variety of formats, offering procedures for validation, and automating invoice input into the ERP.

• Can you elaborate on how have you helped your customers improve financial efficiency and enabled growth?

Our solutions are developed with a focus to provide efficiency and enhance productivity of finance and sales team of corporates irrespective of their size. Our expertise lies in automating AR/ AP processes, reduce DSO and improve working capital optimization for business growth.

By implementing our solutions, over 50 national and multi-national organisations have improve their cash-flow-efficiencies. For instance, Stanley Black and Decker, world’s leading manufacturer of tools and storage products used traditional methods of invoice processing and manual reconciliation which resulted in a 25% productivity loss of sales team. However, after implementing our solution FreePay, Stanley Black and Decker have significantly reduced their DSO, increased the productivity of the sales team as well as reduced their overall cost involved in collections and reconciliation. Our solution also helped them to unlock $1.1 million in working capital through quicker cash conversion.

• What are the trends that you foresee for the future of AI/ML in the B2B fintech industry?

The world has witnessed rapid adoption of advanced technologies like AI/ML in the recent years. This growth has been propelled by the COVID-19 pandemic and put forth digital agenda as the priority across industries. United States companies conduct more than $25 trillion in business-to-business (B2B) payments annually, and B2B transactions account for $120 trillion globally each year.

A Gartner study project that by 2025, half of all B2B invoices across the globe will be issued, processed and paid without any human intervention. Therefore, the B2B fintech industry has a tremendous growth opportunity as automation becomes mainstream. The industry will see a significant shift in digitization of payments to reduce delays and minimizing errors by delegating day-to-day processes, such as payables, invoice processing and record-keeping, to artificial intelligence (AI)-based solutions. Moreover, as e-commerce and cross-border trade becomes ubiquitous, there will be a significant demand for digital remittance settlement across the globe.