Why Your Accounting Department Needs a Mass Payments Solution
The accounting department: a place of business where books are balanced, payments are made, and cheques are cut. As a business owner, you know how much time and effort goes into making sure these functions work properly. At the same time, it's not always easy to make these functions easier using technology, especially if your accounting department isn't really tech-savvy. If this is the case then it may behoove you to research the benefits of Mass Payments Solutions.
Secure payments are critical to the success of any business. Whether you’re a large corporation or small business, electronic payment solutions are an important part of your financial infrastructure. However, these payments also come with their own risks and challenges.
In this post we’ll take a look at some of the most common mass payment solutions used by businesses today and why you should consider adding them to your accounting department.
1. To Minimize Fraud Risk
You can reduce fraud risks while maintaining compliance standards. The faster your team makes payments, the less likely they are to be scammed or hacked by cybercriminals. A bulk payment solution helps ensure that your employees send money only to authorized recipients and avoid sending funds to fraudulent accounts or individuals posing as legitimate ones.
As well as being convenient for employees, this feature also helps reduce fraud risks associated with manual processes by eliminating the need for employees to enter sensitive information on unsanctioned devices.
2. For Better Control over your PAYROLL AND ACCOUNTS PAYABLE
Your business needs a mass payments solution because it will help you keep track of your spending and accounts payable easily. Without this software, you might end up paying too much money in late fees or penalties for late payments. In addition, you may also lose out on discounts that can be offered by some vendors if you pay them on time.
Payroll is the most common use of mass payments. Sage Practice of Now 2019 reveal that payroll is also the second top service performed by accounting firms (25%), just behind accounting/booking. Payroll departments often use mass payments because it saves time and reduces errors in processing payroll checks.
With a mass payments solution, you can improve your cash flow management by making sure that all payments are made within a certain timeframe or when there's enough money available in your account (depending on which option you choose). This helps avoid any unnecessary overdraft charges from your bank account or late fees from vendors for late payments.
Using Xero as an Accountant? Enhance the Payment Experience with Libeo
Did you know that Libeo can improve on what Xero itself misses out on? If not, then find out how Libeo can improve the payment experience for your business.Read full article
3. FOR Greater Efficiency
According to Sage Practice of Now 2020, 82% of accountants say companies are more demanding these days. Companies and accounting practices that oversee a lot of payment operations at once can benefit from a mass payments solution for a variety of purposes, including:
- To pay employees.
- To pay vendors and suppliers.
- To distribute profits to multiple shareholders.
- To distribute dividends to multiple shareholders.
The main purpose of this software is to streamline and simplify the process of making payments. Mass payments systems allow users to send money to multiple recipients at once, usually via a batch or scheduled process. These systems may also incorporate some type of approval process for each transaction, allowing the sender to review each payment before it is sent. This is good news for your accounting department, which can be overwhelmed by the task of processing payments from vendors, employees and customers.
4. TO Improve Compliance and build reliable audit trails
Accurate records are essential for financial compliance. When you send out paychecks to hundreds of employees, mistakes can happen easily. Using a mass payments solution helps ensure that each employee receives the correct amount and that you have accurate records for tax purposes.
With more than half of employers saying that scarcity of talent is their biggest challenge, it's not surprising that many companies are turning to automation as a way to ease the burden on their human resources. Automation can help accounting departments improve compliance by reducing manual processes and making sure they follow best practices.
For instance, mass payments solutions help accounting departments set up reliable audit trails, which are necessary for compliance reasons, as well as for tracking spending for budgeting purposes. This makes it easy for auditors and regulators to trace back where funds came from and where they went if necessary.
5. TO Eliminate Errors
When employees in different departments or locations need to send money to various vendors, banks, or other recipients, it's easy for mistakes to be made in the process of sending funds to multiple recipients:
- Erroneous or missing data
- Calculation Mistake
- Double Invoicing
- VAT not stated correctly
- Sending Invoice to the wrong recipient
By using a mass payments solution, you can ensure that all transactions are accurate and avoid paying too much or too little for goods or services received from vendors. This helps ensure that no unauthorized changes are made without authorization.
6. TO Reduce Labor and Invoice Processing Costs
One of the biggest benefits of an automated payments solution is that it reduces labor costs by automating the process of making payroll deposits, cutting out time-consuming and error-prone manual processes. This reduces labor costs by allowing you to focus on other important tasks in your accounting department, like analyzing financial statements or developing tax strategies.
Aberdeen's expense and invoice management survey shows that best-in-class UK SMBs who are turning to digital technology to automate finance processes, are seeing 24% faster processing times.
In the UK, the average organization spends between £4 and £25 to process a single invoice, research from Gartner says. This figure spans all-inclusive staff and operational costs (receipt, processing, human intervention, approval time, technology, etc.).
Say that you're a small business owner processing (roughly) 100 invoices per month, that means you'd spend £1,500 per month on checking accounts and credit cards alone. Add in merchant fees, and that figure can quickly rise to £2,000 or more per month.
A mass payments solution allows you to pay vendors or employees in one payment at once. This reduces the number of checks or credit card charges that need to be processed — which saves money over time.
CONNECT AND SYNC YOUR PAYMENTS
Finding and entering all your supplier payment details into your banking app is a nightmare. Libeo does it all for you and syncs with major accounting tools like Xero.Book a demo