AR-AP Link To Ease Cash Flow, Strengthen Buyer-Supplier Relations

As calls grow louder for corporate buyers to maintain responsible supplier payment habits, the opportunity for the buyer-supplier relationship to make or break the success of a company grows, too.

In times of volatility, corporates and their business partners must collaborate to find common ground and ensure that cash continues to flow favorably for both sides of a B2B transaction. For these businesses’ FinTech and financial services partners, there’s opportunity, too, to facilitate this cash flow. Deepening ties between accounts payable (AP) and accounts receivable (AR) departments will be key to ensuring buyers and suppliers remain viable.

This week’s examination of the convergence of AR and AP systems explores how FinTech is stepping in between B2B transactions to foster that buyer-supplier relationship by addressing friction on both sides.

Fintainium, CIT Team For SMB Cash Flow

In a recently-announced partnership, workflow management provider Fintainium and payments technology firm CIT said they are looking to enable small businesses to manage cash flow through payment inflows and outflows.

Together, the companies are integrating their technologies, connecting small and medium-sized businesses (SMBs) to Fintainium’s Dynamic Negotiation tool that helps small firms initiate accelerated B2B payment terms in exchange for a dynamic discounting agreement with their suppliers. Dynamic discounting can mean lucrative discounts on the accounts payable side, and faster payments on the accounts receivable side. CIT, meanwhile, will offer its Treasury and Payment Services tools to streamline cash flows for SMBs when both sending and receiving payment.

“Historically, businesses have faced, and continue to face, remarkable complexities when it comes to paying and getting paid,” said Fintainium CEO Richard Jackman in a statement, pointing to the friction points that exist in both accounts payable and accounts receivable workflows.

Argos Risk, Gatekeeper Enable Third-Party Management

Argos Risk and Gatekeeper are teaming up to offer enhanced third-party and supplier risk management solutions in a Software-as-a-Service offering that aims to support the buyer-supplier relationship.

While risk mitigation technologies can enable a corporate buyer to make more informed decisions about which vendors to work with, the tool is also valuable or financial workflows, enabling businesses to assess payment terms and trade credit. Argos Risk offers an AR Surveillance solution, using data analytics to notify businesses of any major changes in their supplier activity, including their own payables habits.

It’s a technology that showcases the interconnectivity of accounts payable and accounts receivable: if a supplier is beginning to show late payment behavior in its own accounts payable operations, they risk not being able to procure the items they need to make the products they sell. At the same time, late payment practices may be the result of their own customers’ delayed payments on the receivables side.

Qwil Enables Vendors To Choose Payment Terms

Qwil recently integrated its supplier payments capabilities within the SAP marketplace, connecting its technology to SAP Fieldglass to enable contingent workforce suppliers to take the lead on deciding how and when they receive payment.

In a press release, Qwil stated how placing some accounts payable decisions in the hands of suppliers on the accounts receivable side can support healthier cash flow.

“Through our partnership with SAP, we are able to provide the outstanding benefits of our solution to tens of thousands of suppliers in the SAP Fieldglass ecosystem,” said Johnny Reinsch, co-founder and CEO. “Now these suppliers can choose their payment terms, putting them in the driver’s seat for the cash flow of their business on any given day.”

Gilded Eyes AR To Support AP Demand

In a recent conversation with PYMNTS, Gilded COO Neal Roche discussed why accounts receivable is a strategic target to encourage B2B transactions to embrace cryptocurrency.

“We realized early on that no one is going to force an upgrade of their current payment channels just to replace them with digital currency,” he said. “Companies need to offer their clients choice.”

Even for companies that are opposed to cryptocurrency like bitcoin, digital currency like stablecoins can be a strategic way for corporate buyers and suppliers to save on cross-border payments and FX costs. Gilded helps businesses accept digital currency in their accounts receivable operations, the result of growing demand among businesses — both in the crypto field and outside it — to make payments using digital currency.

SurePayd On AR’s Role To Promote Cash Flow

Accounts receivable has the power to improve the payer experience in more ways than one. Like Gilded’s effort to wield AR to enable payment choice for business payers, SurePayd COO Karen Stephen recently spoke with PYMNTS about the opportunity accounts receivable staff have to take control of their company cash flows, and improve the client relationship at the same time.

Amid market volatility, delayed and late payments are adding financial pressure on AR teams. Yet through a strategic mix of technology and human empathy, as well as proactive measures on the AR side, payments pressure on the accounts payable end can be eased. Stephen highlighted the opportunity for self-service functionality, automatic payments, and the willingness to work out payment plans as ways that accounts receivable can influence AP behavior while strengthening the buyer-supplier relationship.

Corcentric Lands Funding To Deepen AR-AP Ties

In a statement released this week, Corcentric President and Chief Operating Officer Matt Clark said the company is “well positioned to consolidate the disparate solutions and services that make up the AP and AR markets today.”

The company will continue to deepen the integration between AR and AP operations with new funding from Sagemount. The $80 million fundraise will be used for product development and integration capabilities, the company said, as it expands its source-to-pay, procurement, order-to-cash, AP and AR offerings.

“In these difficult times it is more important than ever to have a single provider of software and services that enables companies to reduce costs and enable automated payables and receivables processes seamlessly from any location,” said Clark.

OnPay Solutions Touts The V-Card For Buyers, Suppliers

Speaking with Karen Webster, Neal Anderson, president and CEO of OnPay Solutions, explored the roles that buyers and suppliers play in digitizing B2B invoices and payments. Both AR and AP teams must collaborate on this, but there are technologies that can sit in the middle of the relationship and ensure both buyers and suppliers benefit from digital transformation.

The virtual card is one tool that Anderson highlighted in particular.

“The ultimate B2B payment is really a virtual card,” he said. “From a payer standpoint, this generates revenue in the form of cash back to the payer, and for any company that’s looking to offset the negative impact they’ve experienced from the pandemic, such as loss of business, this is a great way to do that.”

Suppliers, on the other hand, can benefit from accelerated payments without having to extend trade credit to buyers, as well as from the enhanced security and data that virtual cards provide.

“To be able to provide that information in a specific file format that can be ingested into an accounts receivable system is a great motivator for an AR department to accept those payments,” added Anderson.