Account receivable is a fee which is usually billed as agreed upon between the seller and the buyer, and is recorded as an asset on your company’s balance sheet.
In the business world, customers who pay their invoices on time leave you with one less thing (A/R Collection) on your to-do list. Unfortunately, the reality for most companies is that they need someone in the accounting department to send billing letters or call to follow up on overdue customers. Here are some classic problems that are often encountered in Account Receivable.
Manual payment system
Especially in processing credit card payments manually which can take up your business time and make you face payment challenges in terms of credit card transaction fees. In addition, the payment process via credit card can also expose you to risk.
As more and more companies use credit card payments for the reason that they are faster and more efficient than paper checks, this is a classic problem that you have to deal with.
To overcome this other automated solutions such as virtual payments can turn this payment system into a highly secure payment that is more cost effective than using a credit card.
Use PaperPay Out for your business payments. You can pay for your business needs by credit card or a variety of other methods, although this option is not available. In addition, payment funds will be forwarded directly to the supplier as usual. Feel the benefits and register yourself to use PaperPay Out!
Manage Account receivable manually
One thing that continues to haunt A/R professionals is the manual process that must be carried out such as entering data manually which can reduce team productivity, cause data errors, and so on. It took too long to deliver packages, letters, and payment invoices.
By doing this process, you are actually slowing down the billing process. This means it takes longer for customers to receive paper invoices. Due to the late delivery, the bill is paid later and the check takes longer to arrive. As a result it will lead to a high DSO which has a negative impact on your bottom line or profits.
Automating your A/R process is one solution. Defining automation needs can make the jump from manual to automated processes easier. The benefits of an ever-evolving automated solution will help your business move forward. In addition you can also implement electronic payment methods that can help you reduce the cost of systematically sending paper invoices to customers and ensure you receive and apply payments faster.
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A manual process means you have to go through it manually and figure out where all payments should be applied and allow for human error that can be felt throughout your finance team.
Increasingly sophisticated technology will free up time and resources of the A/R team by enabling technology to complete detailed routine tasks. With this technology companies no longer have to spend time and energy entering information, and make companies get paid faster.
Credit is the key to business. When starting a new customer partnership, credit is a contributing factor that can lead to a deal. Low credit can scare away potential partners, investors, and more.
In addition, credit is also an important part of business. When a company has great credit, they are easy to work with. On the other hand, bad credit can also destroy a deal completely.
Credit technology allows companies to evaluate the credit health of a business before they sign a deal. This allows them to make quick and safe decisions that will not cost them in the future. Credit technology also helps companies close deals more quickly with businesses that have good value.