The Case for Making the Switch to ACH Payments

You try to streamline your business and run it efficiently, cutting costs wherever possible. But what about accounts payable—do you wish your process was more efficient and less costly? An Association of Financial Professionals (AFP) payments cost survey finds that the median cost to send a paper check is $3—or 10 times more than the cost to send and receive ACH payments.

Business-to-business payments made by check have decreased in recent years, from 81 percent of payments in 2004 to 51 percent in 2016, according to an AFP electronic payments survey. But that's still more than half of all B2B payments being made by check. If your business makes most payments by check, you may be able to streamline operations and cut costs by switching to electronic payments.

Your competitors may be making the shift right now. Nearly 80 percent of organizations are currently in the process of transitioning their B2B payments from paper checks to electronic payments, according to the AFP payments cost survey. The primary reasons cited for the move are to increase efficiency (named by 88 percent), reduce costs (82 percent) and prevent fraud (60 percent).

Now's the time to switch to electronic payments

Getting invoices approved, tracking where invoices are in the payments process, keying in information and printing, signing and reconciling checks are tedious, error-prone tasks that are time- and labor-intensive. Electronic payments and automation can provide solutions to common pain points in the accounts payable process. With these changes, your staff will spend less time on tedious tasks and more time focused on strategic business goals.

Streamline workflow. Automated Clearing House (ACH) can eliminate the costly and tedious process of issuing checks. Instead, you can initiate electronic transactions through the ACH network, disbursing funds to your vendors' accounts.

Exert greater control over cash flow. With ACH you can control the timing of disbursements and improve cash forecasting. You always know exactly when your account will be debited. If trimming costs is your priority, you can pay early when doing so provides a discount. Or if liquidity is a more pressing issue, you can put off payment until the due date.

Eliminate the need to reimburse employees for business expenses. When you give authorized employees a Check Card, their purchases are automatically deducted right from your business checking account. You get a detailed record of every transaction and jettison the paperwork involved when employees file reimbursement requests.

Avoid lost or stolen checks. ACH and Check Card payments eliminate lost time and money on stop payment charges and reissuing costs on lost or stolen checks.

Increase efficiency even further by automating your accounts payable and payments process. Integrated Payables is a fully integrated invoice-to-pay solution that allows you to issue Commercial Card, ACH and check payments from a single location. (Terms, conditions, fees and agreement apply.)

Reduce fraud. Integrated Payables features advanced security features and integrates with Positive Pay to help protect your business from fraud.

Enjoy the ultimate in efficiency. You can outsource your entire disbursement processing operation to California Bank & Trust, which will serve as your accounts payable department. It automates disbursements with better security, lower fraud risk, centralized information management and access to new and emerging technologies.

It's time to make accounts payable as efficient as the rest of your business. Tools from California Bank & Trust can help. Learn more about business banking payables services today.[cite::171::cite] [cite::172::cite]