Fall in Love with Finance Series – Automating the Bill Payment Process

Fall in Love with Finance Series – Automating the Bill Payment Process

One of the things business owners don’t like to deal with is bill payments. It’s time consuming, frustrating and doesn’t add value to their business. With all the technology available today to SME’s it’s surprising to see that most bills are still paid using a paper based system. One of the reasons for this is that people are sometimes hesitant to change the way they work. However, automated bill payments can add significant value to your business and remove a lot of the frustration that goes with managing bill payments. Here’s a look at what most businesses paper based process looks like:

  1. Bills are mailed to your business.
  2. The mail is opened and each bill is given to the person who is responsible for approving it.
  3. The bill is approved and sent to accounting
  4. Accounting codes the bill (decided which expense category to apply it to) an enters it into their accounting system
  5. The bill is filed in an open bill filing system
  6. Each week a report is run showing all the bills that are due
  7. A decision is made as to which bills to pay
  8. Checks are printed, signed and mailed.
  9. The bill is filed in a closed bill filing system

An automated bill payment process looks like this:

  1. A user receives a notice that they have new bills to review with a link to log into the system.
  2. The user clicks the link, logs in and approves the bill.
  3. The owner (or finance manager) receives an email saying they have a new bill that’s ready for payment with a link to log into the system.
  4. The owner (or finance manager) logs in and approves the payment.
  5. The payment is made automatically through an ACH payment.

At first glance, you can see that the automated system is much faster and dramatically reduces the time of handling, processing and filing bills. However, there are some advantage that are critical that are not as apparent:

  1. You can approve bills and payments from anywhere and at any time since most of these systems are SaaS solutions.
  2. Automated bill payment systems typically have audit trails so you can track every time someone “touches” a bill.
  3. These systems act as a document management system, creating a database of documents that are searchable.
  4. The potential for fraud is reduced dramatically because of rules for users and the audit trail.

Automating the bill payment process is one way business owners and managers can become far more efficient, lower their costs and reduce aggravation. While you may never fall in love with paying bills, you’ll be much happier with the way this process works for your business.

The information contained within is for informational purposes only.  Always contact an attorney or accountant for professional advice.