The Secret Cost of Manual Payment Processes
The Secret Cost of Manual Payment Processes
The price of processing a single invoice can range from $12 to $25, but this is only the tip of the iceberg when it comes to the total cost of manual payment processes.
The following six factors contribute to the significant expenses and drawbacks of manual payments, which highlight the growing need for a more efficient solution.
Wasted Employee Labor
One of the major costs associated with manual payment processes is the labor required to handle invoices. The number of employees needed, the hours spent on invoice processing, and their hourly rates all contribute to overall expenditure. Additionally, manual payment processes often involve time-consuming tasks that require multiple sign-offs and approvals. Automated AP software simplifies these processes by digitizing invoices, automatically entering data into the accounting system, and electronically paying the applicable vendor. When businesses eliminate manual tasks, personnel can devote more time to strategic initiatives that drive business growth.
Endless Paper, Ink, and Additional Materials
Relying on paper-based systems incurs additional costs associated with printing invoices, such as envelopes, stamps, and ink. Although these expenses may seem minor individually, they accumulate rapidly, especially for organizations dealing with a large volume of invoices. Storing and managing physical documents can also lead to additional costs and space constraints. Adopting cloud-based solutions like Corpay Payments Automation enables businesses to eliminate outdated processes and avoid unnecessary costs.
Accumulative Transaction Fees
Manual payment methods often come with hidden fees related to ACH and credit card processing. Although not immediately apparent, these transaction fees can significantly impact the overall cost of manual payment processes. Fortunately, you can mitigate these fees with Corpay, as they shoulder ACH risk on behalf of their customers. This allows organizations to enjoy monthly cash rebates and benefit from a reliable security and compliance infrastructure.
Costly Mistakes and Redos
Human errors during the data entry stage of manual payment processes can be costly. Mistaken payment amounts, incorrect vendor information, or other inaccuracies may require time-consuming revisions and lead to payment delays. Rectifying these errors further adds to the list of expenses associated with physical workflows, and can even strain vendor relationships. AP automation addresses these issues by instantly detecting and flagging mistakes in real time, eliminating the need for users to check every entry.
Ever-Growing Payment Fraud
Manual payment processes are more susceptible to payment fraud. Unprotected payments, inadequate reviews of vendor information, and errors in payment amounts can leave organizations vulnerable to fraudulent activities. The financial losses from fraud can be substantial, impacting the organization's bottom line and reputation. By minimizing human involvement, AP automation reduces the risk of errors, ensuring greater accuracy in invoice processing.
Eliminate Hidden Costs With an Automated Payment Solution
Adopting automated payment solutions eliminates these hidden costs while enhancing accuracy, streamlining processes, and improving overall financial health and management. Transitioning to AP automation allows organizations to save time, reduce expenses, and redirect their resources toward strategic initiatives that foster growth and success. It's time to leave behind the inefficiencies of manual payments and embrace a more cost-effective and streamlined approach.
Want to know more about the benefits of invoice automation? Contact our in-house experts at Corpay today to discuss your specific invoice and AP challenges.