“Improved payment management is key to resolving short-term cash crunches and helping reduce time spent on non-essential activities.”
VP of Operations
Better control over expenditures ensures that cash is spent wisely and on time. Automating customer payment processing secures cash flow and reduces the time spent on collections processes.
- Time to read: 10 min
- Drink Pairing: Gin Rickey 🍹
- You are a: CTO, CFO
What you’ll learn in this post:
- How to resolve issues paying billing while working remotely
- Signing up customers for electronic payments
- Ways to reduce time spent on administrative tasks related to payments
Troubles with Checks
For many, the headache of dealing with new administrative problems caused by the COVID-19 pandemic has taken time away from tackling larger business challenges. This problem is compounded by the various downstream effects of not receiving or making payments on time.
The NetSuite Electronic Bank Payments SuiteApp can be used to help resolve a variety of problems including electronically making payments, receiving payments and an approval process for stronger accounting controls.
Using NetSuite Electronic Bank Payments SuiteApp
Resolve Logistical Problems
The most apparent problem being faced today is office closures, and not just yours. Having vendors, partners and customers working remotely also have an impact. The NetSuite Electronic Bank Payments bundle helps resolve a number of these issues:
- No one needs to be in the office to cut checks. The same goes for having someone provide a wet ink signature.
- Checks can sit uncashed when customers mistakenly send checks to the office instead of your lockbox. Electronic payments reduce the chance of error while cutting wait times from mail delivery.
- Check printing affects customers too. Providing more options to receive payments helps make sure you get paid on time.
- Faster payments. Slowdowns caused by paper mail no longer cause late payments both in and outbound.
Pro Tip: For worldwide bank support, a number of electronic payment formats exist that support payment management in different currencies and between different countries.
Secure Cash Outflows
People working remotely means that there is less transparency in the day-to-day activities of all employees. Maintaining proper controls and visibility into outbound payments is more important than ever.
- Automate approvals. The Electronic Bank Payments SuiteApp supports approval routing to improve cash management from within NetSuite. Don’t spend time asking for approvals by phone or email. Or worse, by not asking at all. NetSuite supports multi-tiered approvals with approval limits to ensure large payments require additional approvals.
- Positive Pay for eChecks is supported to prevent fraud.
Scenario: Say you are a packaged foods distributor, and one of your vendors is offering you a unique one-time offer to purchase a shipment of product for a reduced price but at accelerated terms. You typically make payments in instalments, and so before entering this large payment in your accounting system, you need to phone your supervisor to get his approval, which could result in delays. With NetSuite payment approvals, your supervisor will be notified when you enter this payment in the system, where he can approve it systematically – saving you precious time!
Prevent Adverse Downstream Impacts
Use instant electronic payments to make sure payments are made on time. These can be used for:
- Purchasing supplies needed for core business functions. Pay bills electronically. Payment delays can cause suppliers to become wary when it comes to extending credit in times of economic uncertainty.
- Paying fixed costs. Paying late fees because of missing due dates from mail delays or staffing issues is completely unnecessary. Or worse, having a service cut-off.
- Administrative overhead from collections processes creates an additional burden and takes time away from other more value-adding activities. ACH payments can be used to direct debit to withdraw funds from customer accounts on time.
Spend Less Time on Administration
Allocate precious time and resources to value-creating activities by avoiding cumbersome tasks:
- Scheduled payments can be used to reduce manual intervention for recurring revenue and paying regular bills.
- Instalment payments are supported for both A/P and A/R. These can be used to streamline recurring revenue and regular monthly bills.
- Faster cash application with less deciphering of memo fields. If you have trouble with customers specifying which invoices they’re paying for, withdrawing payment yourself using pre-authorized payments resolves this.
Reduce Costs and Simplify Processes
Fewer checks mean less check stock that you need to buy. Electronic Bank Payments can be used for more than just paying vendors or charging customers.
It’s possible to move other functionality to electronic payments and treat checks as an exception:
- Employee commissions and expense reports work too. While employee expenses are at a low now, replacing these as well is a way to further reduce costs in the long term by minimizing check usage.
- It works for refunds too. Processing a refund is never desirable but if you have to, you can use electronic payments rather than checks.
- Pay partner commission electronically. Keep referring partners engaged by making sure they’re paid on time. Electronic payments can be used for making partner commission payments as well.
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