Strategic Banking Solutions to Streamline Your Accounts Receivable

Strategic Banking Solutions to Streamline Your Accounts Receivable

Author:  Matthew Martin, Director, Commercial Payments Advisor

While all businesses need to collect payments, the process can look quite different from one company to another. However, there is one thing all accounts receivable (AR) functions have in common. The inherent complexity of the process can negatively impact fiscal health:

• Late payments: According to recent research, 80% of companies are plagued by late payments, which negatively impact cash flow. On the other hand, receiving on-time payments often requires tremendous effort on the part of AR teams, using valuable employee time.
• Slow payment cycles: The need to follow up on overdue payments can quickly outstrip available AR resources, leading to lengthy turnaround times on payments or eventual write-offs when payments aren’t received.
• Insufficient data insights: Without the right processes and tools in place, businesses may lack the necessary data to improve payments processes or to manage cash flows. A lack of coordination between point-of-sale transactions and online sales, for example, can easily obscure critical information necessary for making financial decisions.
• Tracking and reconciling payments: Manual payment reconciliation is prone to errors that can lead to double and missed payments and a high days sales outstanding (DSO).

The need to optimize accounts receivable is a critical yet often overlooked aspect of business operations. However, to maximize impact, businesses should implement customized solutions designed to improve the collections process and enhance overall financial health.

Fortunately, your bank can be a strategic partner in this endeavor, proposing holistic solutions to help accomplish your organization’s specific goals.  

Working With Your Bank to Optimize Accounts Receivable

Acting as a strategic partner, your bank is a valuable resource for optimizing payments and improving cash flow. The first step is to sit down and have a chat with your business banker. Discuss your company’s goals and where current pain points exist when it comes to receiving funds from customers.

FNBO offers a full scope of services in the receivables space, including but not limited to:

• Branch and cash vault services: For businesses that accept POS payments or cash, these services ensure money is safely transported, adding security to money handling and reducing the time AR staff needs to spend out of office facilitating drop offs.
• Remote and mobile deposit capture: Designed to facilitate recurring higher volume or one-off check deposits, these services allow businesses to capture check details through a mobile app and complete deposits remotely. Companies will see benefits in time savings and improved data insights.
• Wholesale and retail lockbox services: Direct your payments to a secure PO Box and allow your bank to pick up and scan remittances, depositing funds directly in your account. You’ll realize efficiency gains and security enhancements, as well as robust online remittance reports.
• ACH origination: Automatically pulling funds from customer accounts is an inexpensive and convenient way to collect recurring payments.
• Merchant services: Robust and flexible, FNBO merchant services allow businesses to accept POS payments onsite, online or on-the-go.

A bank that offers a range of services is better positioned to meet your needs with customized solutions that address the specific issues impacting your AR processes.

Learn more about FNBO’s accounts receivable solutions on our website.

About the Author

Matt enjoys meeting with clients, learning about their businesses and developing relationships on a personal level. He is known for analyzing payments processes and helping to develop innovative solutions that streamline workflows, solve for inefficiencies and eliminate pain points.