Categories: B2B Payments

How AR-AP Connectivity Works To Deepen Buyer-Supplier Ties

As more technology emerges to sit between a company’s accounts payable (AP) platform and its vendor’s accounts receivable (AR) portal, service providers are looking to ease friction in a multitude of ways, from accelerating payments and cash flows to easing contract negotiations.

As a whole, these services have one thing in common: They all reflect technology’s heightened ability to promote stronger buyer-supplier partnerships, with solutions that deepen AR-AP ties while also looking at ways to use automation, data intelligence and FinTech to ease friction for both ends of the B2B transaction. Below, PYMNTS looks at the latest initiatives in accounts receivable and accounts payable that take this approach.

Crowdz Pilots Invoice Crowdfunding

With its new platform InvoiceXchange, B2B payments and invoicing company Crowdz has begun enabling its business clients to crowdfund their unpaid invoices as an alternative to traditional trade financing products. Crowdz recently announced the pilot of its InvoiceXchange platform, which enables businesses to auction off their receivables to support stronger cash flows, becoming a part of the growing invoice financing community aimed at enabling suppliers to access money they’re owed while preserving the buyer-supplier relationship.

Vroozi, Stratas Embrace Vendor Collaboration

In a recently announced partnership, spend management platform Vroozi is working with digital transformation specialist Stratas to help joint customers digitize and transform the AP process. But as accounts payable and accounts receivable become more intertwined, their efforts aren’t only focused on their clients’ AP processes – they’re also looking at the impact on their clients’ vendors. In addition to promoting automation in areas like payments and invoice processing, Vroozi and Stratas also highlighted vendor collaboration as a key component of the digitization opportunity.

Zycus Maintains Buyer-Supplier Agreements

Supplier management is an increasingly important part of the AP process, though can be more difficult to automate. New automation capabilities from procure-to-pay solution provider Zycus aim to support a streamlined vendor management process, including contract management. The company recently announced new so-called “BOTs” designed to automate an array of procure-to-pay processes, including one that automates the review of contractual clauses to ensure that agreements between buyers and suppliers are met – with obvious benefits for both sides of the B2B transaction.

MSTS Eyes AR for Stronger Buyer Ties

In a recent discussion with Karen Webster, MSTS President Brandon Spear explored how to rearchitect and optimize receivables, starting from the very beginning of a business-to-business transaction. That means promoting standardization in the buyer-supplier interaction, which could entail automating customer underwriting for trade credit, standardizing payment terms and mitigating fraud risk. “The proliferation of … data makes the onboarding process even more crucial than it’s ever been,” he explained.

Invoiced, CollBox Ease Payment Collection Interactions

One of the most painful areas of the buyer-supplier relationship is in the collections process. Those partnerships can quickly sour when a buyer fails to pay on time and a supplier turns to a collections agency or other tactics to try to collect. AR solution provider Invoiced recently revealed its collaboration with collections service provider CollBox to ease this point of friction. Invoiced users are now linked to CollBox services to collect what Invoiced Co-founder and CEO Jared King said would otherwise be “uncollectible debt,” without harming the relationship between buyer and supplier. While MSTS highlights the importance of the buyer-supplier relationship at the very beginning of a transaction, this collaboration showcases the opportunity to prioritize that relationship at the very end, too.

Glantus M&A Targets B2B Relationship

While many technologies that sit between accounts receivable and accounts payable aim to make it easier for suppliers to collect payments, a recent M&A deal instead focuses on enabling buyers to recover credit within vendors’ AR systems. Data intelligence and financial automation company Glantus recently secured the buyout of audit credit recovery firm JPD Financial, with the takeover aimed at elevating Glantus’ use of data intelligence to help businesses recover supplier credit and promote deeper buyer-supplier ties.

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The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.

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