5 Challenges in Accounts Receivables Process that Automation Can Solve

Apr 3, 2024 - 12:08
Apr 3, 2024 - 12:10
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5 Challenges in Accounts Receivables Process that Automation Can Solve

The accounts receivable process is vital for any business—it's how you get paid for the products or services you provide. But this process can be fraught with challenges that slow down your cash flow and drain your productivity. From dealing with late payments to manually entering data across multiple systems, the accounts receivable department often faces an uphill battle.   

The good news? Automation has the power to solve many of these persistent challenges so accounts receivable teams can operate efficiently and businesses can get paid faster. Let's look at how automation can streamline account receivables. 

5 AR Challenges Automation Can Solve 

Challenge #1: Late Payments and Collection Efforts 

One of the biggest headaches in accounts receivable is dealing with late or missed payments from customers. Following up on overdue invoices takes significant time and effort from your AR team. Automation can streamline payment reminders by automatically sending overdue notices based on your preferred cadence—think customized emails on days 10, 20, and 30 for example. You can even automate collection calls by syncing with VoIP systems.   

Challenge #2: Manual Data Entry and Duplicative Work 

So much of the accounts receivable workflow involves repetitive, manual data entry—keying invoice details into your ERP, recording payments in accounting software, manually applying cash to outstanding balances, and more. Not only is this painfully tedious work, but it also increases the risk of human error.   

Automation eliminates this duplicative data entry by integrating your ERP, accounting software, CRM, email systems, and more. This means invoices can be automatically generated, payments can self-apply to invoices, and no more manual keying is needed to update records across disparate systems. 

Challenge #3: Lack of Visibility into Receivables 

When accounts receivable data is scattered across invoices, ERP systems, accounting platforms, spreadsheets, and more, it's nearly impossible to get a clear, unified picture of outstanding receivables. You're left in the dark about exactly who owes what.  

Automation pulls all of your accounts receivable data into a centralized dashboard, so you gain full visibility. At a glance, you can see which invoices are open, which payments are expected, quickly calculate metrics like days sales outstanding (DSO), and more. 

Challenge #4: Delayed Cash Application 

Applying cash payments against open invoices is a crucial step to keep your accounts receivable current and accurate. But this is often a time-consuming, error-prone process when done manually—especially for companies dealing with high payment volumes.   

Automation enables cash to be applied instantaneously and accurately by automatically matching payments against open invoices and deductions, and then syncing the updates across systems. No more slowdowns in closing out invoices and recognizing revenue. 

Challenge #5: Limited Customer Experience 

Businesses often drop the ball when it comes to providing a seamless experience for customers to view and pay invoices. Customers get frustrated by having to log into multiple portals, manually download invoices, mail physical checks, or call in with payment info over the phone. 

Automating accounts receivable means your customers gain an optimized payment experience through self-service invoice portals. They can easily view and pay invoices online 24/7 through a secure customer portal. Payments post seamlessly behind the scenes. 



Don't let accounts receivable challenges bog down your team and stall out cash flow. By applying automation to modernize AP workflows, you can accelerate receivables, improve operational efficiency, and ultimately get paid faster. What AR challenges is your business facing that automation could help solve? 

IBN Technologies provides accounts receivable automation solutions to help businesses streamline their AR processes and overcome challenges like those mentioned above. Their cutting-edge automation tools equip finance teams to maximize productivity, reduce errors, and improve cash flow management. 

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