They process invoices, reconcile accounts, monitor compliance and ensure company books are balanced to the penny.
However, these engines have been humming the same tune for often a decade or more. Many rely on outdated systems, layers of manual checks, and technology investments that often lag behind customer-facing innovations.
Now, artificial intelligence is changing all that. Tabs, for example, announced Tuesday (Sept. 16) that it raised $55 million in a Series B funding round to accelerate its development of AI agents for finance teams.
AI isn’t politely asking the back office to catch up; it’s kicking down the door and forcing even the most paper-heavy departments to modernize. From handling invoices to running risk analyses, the speed of AI highlights a central contradiction. Accounting departments are tasked with accuracy and oversight, yet they often remain weighed down by legacy systems and manual functions.
Instead of playing catch-up with incremental upgrades, companies are increasingly leapfrogging over these old processes that once seemed immovable, directly to AI-enabled workflows.
Advertisement: Scroll to Continue
Read also: AI, Cyber Risk and Payments Monetization Put Treasury at the Center of Finance
How AI Is Forcing the Back Office to Modernize
For years, companies justified underinvestment in the back office. If accounts payable processed invoices, if reconciliations happened at month-end and if compliance boxes were checked, then the system worked. But behind the curtain, inefficiencies mounted. Finance and treasury teams built elaborate workarounds, stitching together ERP systems, spreadsheets and email chains to deliver reports. A simple task like approving expenses might require five touch points and multiple system logins.
Against this backdrop, modernization typically followed a predictable path. Businesses would automate a process here, upgrade a system there, and bolt on new modules to existing platforms.
But these small steps don’t match the grandeur of AI’s transformative potential. A finance department considering whether to digitize invoices, for example, now confronts a different calculation. Why stop at scanning documents when AI can extract data, validate it, flag anomalies and route approvals automatically?
The PYMNTS Intelligence report “Smart Spending: How AI Is Transforming Financial Decision Making” found that more than 8 in 10 chief financial officers at large companies are either already using AI in accounts payable or considering adopting it to improve how they pay their suppliers and vendors.
“What companies are starting to see is, hey, there are real applications where AI can help,” Ryan Frere, executive vice president and general manager B2B at Flywire, told PYMNTS in an interview posted Tuesday. “It can help us be more efficient … reduce cost … maybe get paid faster … Instead of exploring it now, we’re going to start rolling out a few things.”
The leapfrogging dynamic arises because AI applications don’t require the same infrastructure build-out as older technologies. Cloud-native AI tools can integrate through APIs, bypassing the need for a wholesale ERP overhaul.
Startups offering AI-driven reconciliation or dynamic compliance systems often pitch themselves as layered intelligence that rides on top of whatever systems a company already has. In other words, firms can vault directly into advanced capabilities without the slow grind of legacy upgrades.
See also: Agentic AI Puts a Face on Corporate Treasury’s Next Leap
The Next Frontier of Autonomous Finance Ops
Finance and treasury functions sit at the heart of this transformation. These teams manage massive transaction volumes, where speed and accuracy are non-negotiable, and where the payoff from improved efficiency is immediate and measurable.
Findings from PYMNTS Intelligence’s July Digital Financial Services Tracker® Series report, “AI Power: The Technology Transforming Accounts Receivable,” revealed that AI is transforming accounts receivable from a reactive, transactional function into a proactive, relationship-centered discipline.
Compliance, too, is becoming more dynamic. Instead of static rulebooks, AI-driven compliance systems update in near real time as regulations change, tailoring alerts to specific exposures. This can prove especially critical in industries like banking, where cross-border operations mean navigating a labyrinth of evolving requirements. AI doesn’t eliminate the need for human judgment, but it can reduce the volume of manual monitoring and review.
None of this is automatic. AI brings its own risks, including biased models, opaque decision-making and regulatory scrutiny of its own. Finance and treasury leaders must ensure auditability. Every AI-driven decision must leave a trail that can satisfy regulators and auditors. Cybersecurity concerns also loom large, as the integration of AI tools may widen the attack surface.
Looking ahead, the back office no longer needs to be a laggard. AI is dragging it, sometimes reluctantly, into the future. In doing so, it is collapsing the line between operational necessity and strategic advantage.
Register for the upcoming B2B PYMNTS 2025 event, “B2B.AI: The Architecture of Intelligent Money Movement,” taking place Oct. 6-31.
For all PYMNTS B2B and AI coverage, subscribe to the daily B2B and AI Newsletters.
