by Navin Gupta, on Apr 22, 2021 5:28:12 PM
Estimated reading time: 2 mins
Fast-tracking invoice processing and availing early payment discounts has always been a distant dream. Cotemporary processes involve receiving the physical form of the invoice, performing duplication checks, conducting two-way / three-way matching, and finally releasing the invoice for payment. With F&A professionals working on legacy systems that have inherent system limitations, invoice processing takes 5 days at best and 15 days at worst. However, the process can be expedited to T+1 processing with the help of invoice image processing through centralized Cloud applications.
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How does the Invoice Image Processing over the Cloud work?
When the vendor and the customer approver are lodged at geographically distant places, this system offers the maximum benefits. Vendors, when onboarded by a business, are allotted access to the vendor portal, which is hosted on Cloud. On delivering a product or a service, the vendor clicks a clear picture of the GST invoice, uploads it to the vendor portal and forwards the physical copy through snail mail. The approver, who has received the product or the service, approves it for further processing.
In case of PO invoices, the invoice is auto-read and auto-validated by an Intelligent Document Processing solution on Cloud against the soft copy of the PO and Goods Received Note or receipt. In case of Non-PO invoice it is auto-validated against the email approval and receipt. In case of any discrepancy, the invoice is shunted back to the vendor with a corresponding email trigger for correction and re-submission.
The Intelligent Document Processing solution, mentioned here, is an Artificial Intelligence / Machine Learning enabled ultra-efficient document reader and data extractor. It is not only capable of intelligently extracting data and figures from the invoice image but also validating the extracted details for faster processing by the Accounts Payable department. The data thus extracted can be processed for payment in T+1 days.
It is interesting to note that the Cloud leverage for the vendor portal and the Intelligent Document Processing solution facilitates the fast-tracking of the invoice processing to T+1, which otherwise takes T+5 to T+15 days. This method of image processing is also used as a best practice in the Clearing House Cheque Processing. The same principle is used in Travel & Expense Management solutions.
Benefits of invoice image processing
The innovative system generates multi-fold benefits for the business at its affiliates:
- Improves cash flow in the business ecosystem
- Offers high transparency in payment operations
- Develops sustainable vendor partnerships
- Brings in high accuracy and productivity due to automation
- Increases supplies in the ecosystem facilitating healthier business ties
- Allows to avail early payment discounts
In conclusion
Improving cash flows in the business-vendor ecosystem is the need of the hour. Contemporary invoice processing progresses through many manual touch points that breed delays in invoice approval and payment. By hosting the Invoice (Image) Processing over the Cloud, businesses are able to expedite the processes and tide over delays that breed due to manual handling of invoices and documents.
