5 Ways SMBs Can Modernize Payments
Small and medium enterprises (SMEs) face a number of operational challenges when managing their growth.
From tracking accounts payable (AP) and accounts receivable (AR) to ensuring liquidity strategies are optimized for scale, adding the latest payments technology to a financial management strategy can be daunting. Here are five common areas where SMBs considering payments modernization might see the need for a modern approach to AP/AR.
1. Manual Invoice Review
When invoicing is not automated, SMBs can lose control of liquidity and cash flow visibility. Entering invoices manually can also lead to errors which, in turn, can cause businesses to spend more time settling incomplete payments.
2. High payment/credit costs
When payment choice is not available, businesses may resort to high-cost credit options or fee-based payment methods to meet their liquidity needs.
3. AP/AR not integrated with other systems
When AP/AR data is not integrated with other core systems, such as accounting software or enterprise resource planning platforms, SMBs waste time manually entering data and risk committing errors that alter cash flow forecasts.
4. No single cash view
Ultimately, accurate data leads to profitable business decisions. When SMBs have access to a single view of their cash flow, they can build long-term growth strategies using accurate cash flow forecasts and up-to-date liquidity management options.
5. Lack of payment choices
Multiple payment methods give buyers and suppliers more control over their cash flow, which means better payment choices can have a huge impact on an SME’s bottom line.
Like their customers, SMBs want simpler payment processes, but must contend with a space where easy digital payments have often been elusive. To learn more about this topic, download the Future of Commercial Suppliers Innovation Report, a collaboration between PYMNTS and Plastiq.