13 Everyday Remittance Scenarios: Unlucky for Cash Application?

Is Your Cash Application Slow And Error-prone?

Complex remittance processing could be the reason

Straight-through processing is when payments are posted against open invoices in your ERP without any manual intervention.

As per a survey by NACHA-CRF 67.5% respondents have less than 60% straight-through posting. Adoption of varied e-payment formats and non
standardized remittance details could be the reasons for these low numbers.

What Ideal Remittance Processing Should Resemble

A well-oiled assembly line

In a perfect world, the A/R department would receive all its check payments with remittance details keyed-in by the bank and all its e-payments accompanied with standardized remittance advice that could directly be reconciled for cash posting. The direct match between the invoice numbers on the remittance and invoices would create a true straight-through process.

The Real Picture of Remittance Processing

Too much variability in remittance scenarios

Due to the lack of any standardization, remittances continue to come from various sources and in various formats and templates. Each remittance scenario has a series of variable tasks, which prevent analysts from achieving the rhythm of an assembly line.

An AS-IS evaluation of cash application process indicates that most of the variability lies in two steps:

       1. Remittance fetching

       2. Interpretation of data

Error-prone process

A highly manual and repetitive process leads to erroneous cash posting and additional burden on analysts for resolving exceptions.

Delayed cash posting

Time consuming activities of fetching and entering data slows down the cash application process. Analysts struggle to post cash the same day during
seasonal spikes.

Low employee morale

High volume of low-value tasks without any strategic impact reduce cash application analysts to cash application clerks. Their entire days are spent chasing transactions and spreadsheets.

End-to-end Automation For Remittance Capture

Staying future-ready with Artificial Intelligence

Artificial Intelligence transforms the remittance capture process from an ad-hoc, unstandardized set of processes to an assembly-line approach. Due to the template-free technology, it supports all forms of remittances, making it future-proof and helps your team in accepting more e-payments that tend to come with decoupled remittance details.

The key benefits associated with AI-enabled remittance capture are:

• Cut costs on lockbox feesAI-enabled OCR captures check remittance data automatically, removing any dependency on bank lockbox services or in-house resources for key-in, thereby reducing costs
• Eliminate templates with an AI-based capture engine that growssmarter over timeTemplate-free technology based on AI captures all remittance details even when thecheck stub comes in a non-standardized or unfamiliar format
• Achieve 95% posting rate by eliminating errors associated with manual data entrySelf-learning OCR captures data with 95% accuracy, eliminating the need forexception handling when posting check payments
• Free up resources for strategic credit and collections activitiesAutomate manual tasks of email remittance aggregation and data reading to focus resources on strategically important A/R operations

HighRadius is a Fintech enterprise Software-as-a-Service (SaaS) company. The HighRadius^TM Integrated Receivables platform reduces cycle times in the order-to-cash process through automation of receivables and payments across credit, electronic billing and payment processing, cash application, deductions and collections.

Powered by the Rivana^TM Artificial Intelligence Engine and Freda^TM Virtual Assistant for order-to-cash teams, HighRadius enables organizations to leverage machine learning to predict future outcomes and automate routine labor-intensive tasks. The radiusOne^TM B2B payment network allows suppliers to digitally connect with buyers, closing the loop from supplier receivable processes to buyer payable processes.

HighRadius solutions have a proven track record of optimizing cash flow, reducing days sales outstanding (DSO) and bad debt, and increasing operational efficiency so that companies may achieve strong ROI in just a few months.

To learn more, please visit www.highradius.com

HighRadius’ Integrated Receivables Platform

Integrated Receivables optimizes accounts receivable operations by combining all receivable and payment modules into a unified business process. The Integrated Receivables platform provides solutions for credit, collections, deductions, cash application, electronic billing, and payment processing – covering the entire gamut from credit-to-cash.

The HighRadius^TM Integrated Receivables platform stands out by enabling every credit and A/R operation to execute real-time from a unified platform with an end goal of lower DSO, reduced bad-debt, and faster dispute resolution while improving efficiency and accuracy for cash application, billing, and payment processing.

HighRadius^TM Integrated Receivables leverages Rivana^TM Artificial Intelligence for Accounts Receivable to convert receivables faster and more effectively by using machine learning for accurate decision making across both credit and receivable processes. The Integrated Receivables platform also enables suppliers to digitally connect with buyers via the radiusOne^TM network, closing the loop from the supplier Accounts Receivable process to the buyer Accounts Payable process.