According to a recent study from Versapay and Wakefield Research, 73 per cent of executives believed that the I2C process is vital in creating a positive experience for customers. Further, 80 per cent of respondents cited I2C miscommunication as the primary source of lost revenue.
Digitisation initiatives in the I2C and AR spaces will accelerate to the forefront of importance for organisations in 2023. According to Esker, global, AI-driven finance and customer service cloud platform, this will become more apparent as the role of the CFO continues to evolve.
SteveSmith, COO at Esker, sat down with The Fintech Times to discuss how digitally transforming the I2C and accounts receivable (AR) processes can create more positive partner relationships, improve customer experience, and increase cash-on-hand by improving forecasting capabilities and preventing revenue loss from invoice miscommunications.
Money In, Money Out: The “New” Explosion of Invoice-to-Cash
When it comes to business, relationships are the hub around which the wheel of innovation turns. ‘Necessity is the mother of invention’, as the adage goes. More often than not, our greatest innovations are borne out of a need to protect and enhance shared experiences.
The relentless rise of remote work and videoconferencing has changed many aspects of how we relate to one another. This includes how businesses position and process payments. Digital payments have been widely adopted as the new reality. Investors are paying close attention to how financial software and cryptocurrencies are remaking e-commerce and payment networks. Companies that lag in this trend run the risk of becoming obsolete.
Perhaps more than anyone else, CFOs are uniquely positioned to implement much-needed structural changes within organisations. They know the nuances of the value chain and act as a bridge between various stakeholders.
Besides reassessing business growth from the standpoints of efficiency, fraud-risk and sustainability, CFOs feel the increasing weight and importance of customer experience. Indeed, 90 per cent of CFOs agree that “the C-suite is only as good as their customer experience”. This speaks volumes about the fact that technological trends are only as effective as the inroads they create, which is why the invoice-to-cash (I2C) process — among others — is starting to explode in the fintech sector.
I2C: What it is, where it’s going
The I2C process starts when an invoice is created and ends once a customer’s debt or payment is settled. Invoicing has existed in some form as long as human civilization, with the introduction of computerised processes starting in the 1980s. Electronic Data Interchange (EDI) arrived in the early 2000s as a hybrid form of invoicing. The barcode at the bottom of the invoice was the only automated element of the process.
Today, virtually every aspect of the invoicing process can be digitised and automated, should a business choose to avail itself of current technologies.
Beyond ensuring the organisation gets paid, though, I2C is a vital part of creating a positive customer experience. This should not be surprising, given that it exists in that delicate space wherein company cashflow and customer return coexist. Without a robust accounts receivable (AR) strategy backed by technological innovations like SaaS and AI, many businesses will languish in an increasingly digitised world.
No wonder nearly 80 per cent of CFOs cite confusion and conflict in the I2C process as the primary source of lost revenue.
Stronger I2C to clear the confusion
Strengthening AR strategies creates enormous benefits for both business owners and their customers. CFOs seeking to prioritise foolproof, digitised operational systems will look for solutions that include:
- Improved customer experience: Payment collection has plenty of potential emotional hotspots. This is why ensuring customers have a good experience is crucial. Offering options like preferred payment methods and self-service customer portals can positively impact customer experience and ensure retention.
- Integrated, automated solutions that manage end-to-end processes. Automating AR processes streamlines everything from creating and processing invoices to assessing credit risk. It also heightens data acuity, speeds the delivery of invoices, and prioritises tasks according to urgency.
- Improved data security and risk management: Digitisation brings with it an increased chance of hackers attempting to access sensitive information. Robust I2C solutions can offer data encryption and meet industry compliance standards.
- Reduced costs: Many businesses spend hundreds of thousands of dollars each year processing paper invoices. E-invoicing eliminates the cost of paper, reduces errors and offers customisable templates.
- Extended AI capabilities: Early identification of AR risk, predictive analytics and dispute resolution lead to better cash application rates.
- Reduced technical debt: AR automation provides a single source, flexible architecture to suit the needs of CIO or IT, offering easy access to archives in a decentralized setting. This reduces technical debt, increases a sense of team building, and creates more time for creative work and networking with potential prospects or investors.
Image and article originally from thefintechtimes.com. Read the original article here.