5 Tips for Finance Managers to Prepare for Digital Payments

What are the most pressing issues affecting finance managers today?

With advancing technology, a lot of companies and their customers have shifted to non-cash payment systems. In fact, according to McKinsey, the use of digital payments will increase to 89 percent by the end of the year 2022. Thus, it is crucial for finance managers all over the world to also modernize their processes to keep up with these changes. 

This can be due to a number of concerns, the most common of which include:

• Difficulty in tracking real-time and cross-border transactions
• Lack of a single overview of all payments
• Difficulty in tracking and managing refunds
• Slow and ineffective reconciliation process
• Difficulty in managing cash flow
• Lack of automation and manual processes

How to achieve an efficient cash management process with digital payments?

To resolve traditional payment and liquidity management issues, you must strengthen three core processes:

Liquidity management and cash visibility are closely intertwined to achieve an effective payment protocol. Therefore, it is essential to have the right tools in hand. With this in mind, here are the five tips that will help you make this transition effectively:

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      Decrease the payment processing time

      
      

If you have too much downtime in your payment process, then you’re losing money. By automating your payment process, the time taken for reconciliation is minimized. This reduces errors, the labor costs involved in processing paper checks, and the amount of time spent waiting for funds to be posted.

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      Track and manage accounts signatories

      
      

A proper signatory process is the only way to know who has access to your cash. Keep all of your bank account records up-to-date, including the number of signatories on each account, their respective access levels, and any changes that have been made. 

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      Offer a variety of payment modes

      
      

With changing times, your customers also prefer payment flexibility. You must consider what they need in order to provide it. What non-cash payment options do they use? Are they solely interested in credit or debit cards, or do they prefer something different? Offering a range of payment methods is important, as it gives them more alternatives and increases the likelihood of receiving collections on time

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      Communicate changes to the customers

      
      

Make sure to give your customers a heads-up before you make any changes. Be specific about the changes and why you’re making them. This will keep your  customers informed about what’s going on with your business and also reassure them that their payments won’t be interrupted. In times of growing competition, customers expect a much higher level of customer service, and by communicating with them, you gain their trust in your services and help them with the transition.

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      Adopt a cash management solution

      
      

A cash management solution allows you to see exactly how much money you have at any given time and where it comes from. This means that if someone owes you money but doesn’t pay on time—or at all—you’ll know immediately so that you can take action accordingly. In today’s world, where most businesses use multiple payment methods and currency rates are constantly changing, this is even more important.

Adding digital payments to your business can enhance operational efficiency and build stronger customer relationships. To achieve proper cash management with digital payments, talk to our experts.