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What You Don't Know About Automating A/R Financing May Blow You Away

Posted by Michael Noble - 11 April, 2022

What You Don't Know About Automating A/R Financing May Blow You Away

What You Don't Know About Automating A/R Financing May Blow You Away 

Platforms like HighRadius and Billtrust have been automating accounts receivable for enterprise organizations for years. They’re tried and trusted A/R automation – last year alone more than $1 trillion in invoice dollars were processed on Billtrust. However, innovation in this space has generated exciting new capabilities that can either be integrated with these platforms or used as a standalone. The difference is the integration of guaranteed next day financing on all open invoices. 

Financed credit and A/R automation allow global enterprises to transform their credit, A/R, and collections processes. One of the best use cases is with a B2B company’s long-tail customers – the 80% of the customer base that generates only 20% of the revenue. B2B companies can utilize a financed credit and A/R automation platform to standardize and streamline these frequent, lower-value transactions. With the entire procure-to-pay process for this segment put on auto-pilot, the company’s A/R team can better manage top-tier customers with its traditional A/R automation platform. 

An increasing number of A/R teams are using financed credit and A/R automation to transform their A/R operations and deliver significant value to their organization in measurable ways:  

Ending bad-debt write-offs.

Businesses write off about 4% of accounts receivable on average as bad debt. A $10 million company could expect to lose $400,000 per year simply as a cost of doing business. Financed credit automation can reduce this loss by decreasing Days Sales Outstanding (DSO) to one. When trade credit automation is combined with guaranteed next day financing on all open invoices, sellers are paid immediately, with no extra effort required to collect. At the same time, sellers keep their customers happy by continuing to offer net terms. DSO of one reduces or ends bad-debt write-offs, and enables A/R teams to better predict cash flow, which can fuel and accelerate company growth. 

Late payment infographic

Meeting customers’ new service expectations.

Accelerating digital transformation in the past two years has changed B2B customers’ perceptions of what good service is. Now, more than 80% of B2B buyers expect what B2C sellers have perfected – a fast, simple, digital and convenient buying experience. 

Financed credit and A/R automation help B2B companies create and standardize a great digital buying experience with:

  • Fully digital procure-to-pay process, from credit approvals to payments to reporting
  • Pre-qualification and onboarding in minutes
  • Credit lines over $1 million
  • Net terms in customers’ currencies  
  • Multi-language portals that enable customers to create purchasing teams, autopay, and track invoices 

Getting a return on investment in digital

B2B companies are taking a close look at the ROI on automating A/R before they commit to the effort involved. Of those that have deployed it, three in four companies surveyed say A/R automation has improved team efficiency and reduced operating costs, but the question is, by how much?

Based on the track record of current adopters, the ROI looks promising: Financed credit and A/R automation is saving B2B companies up to 50% on fixed A/R costs. A/R teams can turn their focus to troubleshooting, issue resolution and white-glove service for high-revenue customers.

A/R automation infographic

Create first-of-its-kind competitive advantages for your company

Apruve is the only provider that combines trade credit automation with guaranteed next day financing on all open invoices. On average, B2B companies see a 40% ROI by eliminating in-house management and financing their own credit program with Apruve. If you’re interested in exploring the potential of financed credit and A/R automation for your company, talk with Apruve’s specialists. Get in touch with Apruve today.

Topics: Finance


ABOUT APRUVE

Apruve enables large enterprises to automate long-tail credit and A/R so you can stop spending 80% of your time and resources on 20% of your revenue. We partner with each of our customers to solve their unique credit, payment, and accounts receivable challenges and build the right credit solutions for your markets, customers, and goals. 

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