Controllers Council recently held a CPE training webinar titled, AP and Payment Best Practices for Controllers and CFOs, sponsored by AvidXchange.
Our subject matter experts were Jamie Procter and Rhonda Green. Jamie is a Senior Solutions Consultant at AvidXchange. Rhonda is Principal Solutions Consultant at AvidXchange.
Following are key takeaways to this discussion. If you are interested in learning more, view the full webinar archive video here.
Top Priorities and Challenges of Finance Leaders
AvidXchange conducted a survey of 500 finance executives at middle market companies in September of 2023 to understand their priorities and concerns as they planned for 2024. And what we found was the top priorities and concerns really mirror each other, with the top three being data protection, security, and regulatory compliance. Number two being digital transformation and the third one being creating operational efficiencies. I think this is standard. I would think that data protection, security and regulatory compliance would always be at the top of the list. But I think we all know in this world of digital transformation that we’re living in that we’ve got to learn all about it and really stay on top of new trends. We must be proactive in upskilling our workforce so that they are prepared for all the AI and digital transformations to come.
So additional top concerns of finance departments for that same survey, we found that the top three again, security, fraud, and phishing attempts. Number two was data management, and number three was the digital skills gap of teammates. So again, security and fraud always top of mind. Phishing attempts unfortunately continue to be a big problem.
Parting Ways with Paper
Paper adds all kinds of inefficiencies to the process. When you’re trying to manually route invoices for approval, again, walking them down the hall, sending a scanned copy in an email, you’re adding lots of time to the process and increasing the odds of the document being misplaced. And we honestly see that every single day when we’re talking with different prospects in the market and people having issues with missed payment, duplicate invoices, and even compliance risks. So only 8% of organizations are using checks most often to buy suppliers, to pay with suppliers. This data point tells us something powerful. Really, about 8% of organizations are still using checks with their primary payment methods, which is a massive drop. And it’s part of a larger trend.
So, more businesses are recognizing that paper checks aren’t just slow, they’re also costly and vulnerable to fraud. I can’t even tell you how many times I’ve spoken with a client or a prospect that say that what made them move to AP automation was truly check fraud. Unfortunately, that’s still heavy and happening all over the country today. If your organization is still check heavy, you’re quickly becoming the exception rather than the norm.
Break Down the End-to-End Automation Process
The best AP automation strategies don’t focus on a single process. They optimize the full journey from procurement and invoice processing all the way through to payment execution. Automating these stages unlocks tighter spend control, faster invoice approvals, and more reliable payment schedules. And when they’re integrated into a single platform, you gain visibility and reporting that simply isn’t possible with siloed systems. And if we look at the graph here or the illustration, it really does walk us through the full process from PO creation and approval. But with automation now, those POs can be quickly in requisitions created and then gone through an automated workflow. Same with invoice receipt. We’re able to capture invoices electronically now and take care of all that data entry. And it goes all the way through the workflow approvals, the information, all that invoice data is now synced back into the accounting system.
So, the payment is the next logical step. So those payments will also be issued electronically and approved. And then when the vendor gets the payment, then reconciliation is super easy. So really, it’s taking what is a very tedious manual process.
Let’s talk about the payment method used most often to pay suppliers. And this comes from our 2025 Trends Survey, where we found that 28 % of finance leaders said that they exclusively use e-payments or electronic payments for vendor transaction. And that number continues to grow as organizations seek to reduce payment cycles, improve accuracy, and manage remote teams. So, if your team isn’t already moving in this direction, now is the time to start the conversation internally.
Electronic Payment Methods
Today’s payment landscape offers a wide range of digital tools. So, you’ve probably heard of a lot of these, ACH, virtual credit cards, wire transfers, real-time payments, even mobile wallets. Each have their pros and cons, depending on the size and needs of your organization. But really, I think the real value is in having flexibility. So that, for automation, can help you centralize your payment strategy without locking you into just one or even two methods.
Let’s walk through some of the most popular electronic payment methods that businesses and consumers are using today. We’ll start with credit cards, which allow the payer to borrow funds without the expectation that they’ll pay them back over time, or with the expectation they’ll pay them back over time. Typically, with interest, these remain one of the most widely accepted forms of payment for both personal and business transactions.
Debit cards work a bit differently. They immediately deduct funds directly from the payor’s checking account. So instead of borrowing the money constraint from available cash, next is the virtual credit card. This operates like a regular credit card, but for security purposes, each transaction generates a unique card number and expiration date, which greatly reduces the risk of fraud, especially for online and reoccurring transactions. And I’ll talk more about virtual credit cards little bit later when we talk about AvidXchange and our process. Online banking allows a payer to conduct transactions through their bank’s digital platform. This includes everything from bill payments to peer-to-peer transfers. And electronic funds transfer, or EFT, moves money directly from the payer’s bank account to the payees without the need for physical checks or cash.
So, shift income methods commonly used in the business world. I feel like everyone has probably heard of ACH or the Automated Clearinghouse with the ACH network. This is electronically moving funds between bank accounts and large batches. This is especially popular for payroll and vendor payments because of its reliability and low cost. We’ll talk a little bit more about ACH and even our version of an ACH through AvidXchange.
Something that I’m seeing a lot is, especially since this pandemic is a lot of companies have been really trying to push to switch their vendors from CHECK to ACH. But again, keeping in mind that you really want a variety of options and having just those two options can kind of limit you and your vendors. Wire transfers are another option.
How to Evaluate Payment Technologies
To view this question and learn more about AP and payment best practices, watch the full webinar here.
ABOUT THE SPONSOR:
AvidXchange is a trusted, leading provider of accounts payable (“AP”) automation software and payment solutions for middle market businesses and their suppliers. AvidXchange’s Software-as-a-Service (“SaaS”) based, end-to-end software and payment platform digitizes and automates the AP workflows for over 8,000 buyer customers, and it has made payments to more than 1,200,000 supplier customers over the past five years. Additionally, AvidXchange, Inc. is a licensed money transmitter for US B2B payments, licensed as a Money Transmitter by the New York State Department of Financial Services, as well as all other states. For more information, visit: www.AvidXChange.com.
