AI-Driven Accounts Payable: Elevating AP From Cost Center to Strategic Asset

The persistence of legacy accounting practices continues to make accounts payable (AP) a significant challenge for many companies. Manual processes cost time and money while delaying payments and increasing errors. However, artificial intelligence (AI) is promoting AP from the back office to the front lines of financial strategy. In 2025, organizations are using AI-driven AP innovations to anticipate supplier needs, detect fraud earlier and optimize payment flows with virtual cards. Solutions such as Finexio’s AP Payments as a Service and Card by Mail service showcase how these changes are making AP strategic, monetized and risk-resilient.

Predictive Supplier Enablement: From Reactive to Proactive

AI-Driven Fraud Prevention and Self-Healing Operations

Virtual Card Innovation: AI as a Payment Decision Engine

Leveraging AI to Drive Payment Innovation

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Predictive Supplier Enablement: From Reactive to Proactive

Switching from manual to electronic payments reduces costs and errors, but identifying suppliers that accept digital payments can be a challenge. AI can help.

Manual processing and legacy payment methods still constrain AP operations.

Despite steady digital transformation, many AP departments remain mired in manual workflows. According to HighRadius, more than two-thirds of businesses still key invoices manually into enterprise resource planning (ERP) or accounting systems, creating costly bottlenecks and errors. Paper receipts persist in 37% of firms, and even digital invoices require manual data entry for more than half of their fields. These inefficiencies delay approvals, strain staff resources and drive up costs. AI-powered automation offers a remedy—reducing human intervention, accelerating invoice capture and giving teams time to focus on strategic value creation rather than clerical processing.

93%

Accuracy with which Finexio’s AI-powered solution can predict supplier payment preferences

Electronic payments and virtual cards can speed up the process, reduce disputes and simplify tracking. However, knowing each supplier’s payment preferences and how they may evolve can be a chore for AP teams. Today, AI-powered predictive analytics are solving this challenge.

Analytics transform supplier enablement into a predictive science.

AI is enabling AP to move upstream. Rather than reacting to supplier payment delays or disputes, systems can now predict which suppliers are likely to accept digital or electronic payments, which payment methods they prefer, and when they need support, significantly improving adoption.

For example, Finexio’s AI-powered supplier enablement framework predicts supplier payment preferences with near-perfect accuracy, accelerates adoption of virtual card and electronic payments, and reduces manual intervention—improving conversion, throughput and supplier satisfaction. By leveraging large datasets, including proprietary data from thousands of suppliers and comprehensive information from major card networks, the platform has proven to be 93% accurate at predicting supplier payment preferences and 84% accurate at identifying suppliers that will transition to virtual cards. This capability can transform how CFOs think about liquidity.

AI turns AP from a cost center into a revenue generator.

Paper checks remain one of the most expensive and least efficient ways to pay suppliers—costing enterprises an estimated $8 per check when accounting for materials, postage and labor. Virtual cards and electronic payments eliminate those costs while reducing fraud exposure and reconciliation delays. The capacity to predict which suppliers will accept digital methods allows finance teams to migrate more payments electronically, improving cash visibility and freeing trapped liquidity. AI-driven forecasting and supplier insights transform AP from a cost sink into a working-capital engine, turning faster payments into measurable financial advantage.

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AI-Driven Fraud Prevention and Self-Healing Operations

Manual payment systems are not only slow and costly but also vulnerable to fraud. Generative AI is increasing fraud risk, but AI can also be a shield against losses.

AI is increasing the risk of AP fraud.

92%

of companies using AI-supported AP tools reported faster identification of suspicious activity.

Generative AI (gen AI) is reshaping both commerce and crime. According to Basware, 62% of businesses cite gen AI as a primary contributor to rising fraud attempts, driven by convincing fake invoices, synthetic identities and deepfake impersonations. Manual AP processes are especially vulnerable. High transaction volumes and limited oversight make it easy for fraudulent documents to slip through undetected. As AI tools become more accessible, fraudsters can mimic suppliers, alter payment instructions or replicate executive voices with alarming realism. Without automated verification and anomaly detection, traditional AP systems simply cannot keep pace with AI-enabled deception.

AI can also defeat AI fraud—and heal payment failures.

AI now serves as both shield and sentinel. Machine learning (ML) algorithms continuously analyze transactional patterns to detect subtle deviations—such as unexpected account changes or duplicate invoices—before they escalate into losses. Embedded features like Office of Foreign Assets Control (OFAC) screening, real-time account verification and behavioral anomaly detection create layered defenses. In addition, automated “self-healing” payment flows not only reroute failed transactions but also contribute to fraud detection and prevention by using automated countermeasures. According to Basware, 92% of companies using AI-supported AP tools reported faster identification of suspicious activity. These capabilities convert fraud prevention from a reactive function into an intelligent, adaptive network that learns from every event.

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Virtual Card Innovation: AI as a Payment Decision Engine

Virtual cards are the cutting edge of digital payments, but adoption remains low. Innovators are leveraging AI and new approaches to boost acceptance.

Virtual cards streamline payments and boost fraud protection.

Virtual cards are redefining how enterprises pay suppliers—issuing unique, single-use card numbers for each transaction to enhance control and transparency. This eliminates exposure of primary account details and simplifies reconciliation, since each payment is traceable to a specific invoice. Unlike checks or automated clearing house (ACH), virtual cards can be activated instantly and carry embedded spending limits, greatly reducing the risk of misuse or theft. AI acts as the decision engine, determining the best-fit payment method by analyzing supplier behavior, transaction volume and cost efficiency. The result is reduced fraud, faster cycles and a strategic foundation for monetized AP.

60%

Virtual card adoption rate achieved by Finexio’s Card by Mail solution, compared to a U.S. B2B industry average of 7%

Card by Mail breaks virtual card adoption barriers.

Acceptance of virtual cards remains low within the overall United States business-to-business (B2B) payment space, with adoption estimated at 7%. That led Finexio, a leader in AP payments as a service, to launch its Card by Mail virtual card solution. By eliminating the need for individual supplier onboarding or email setup, Card by Mail removes barriers to adoption. Initial virtual card payments are sent by mail. Suppliers may then choose to process the cards, opt out or upgrade to email delivery of their virtual cards for faster receipt of payment.

Since introducing the system, Finexio has seen the adoption rate grow to more than 60% among suppliers invoicing up to $100,000 per year, according to the company. It is now expanding Card by Mail to additional industry segments using its AI and ML models to identify strong virtual card candidates.

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Leveraging AI to Drive Payment Innovation

AI is turning accounts payable from a reactive back-office function into a predictive, strategic engine. By embedding AI across supplier enablement, fraud detection and payment decisioning, AP teams can reduce costs, accelerate payments and strengthen supplier relationships.

PYMNTS Intelligence offers the following actionable roadmap for companies looking to bring AI-driven innovation to AP:

Eliminate paper-based friction. Remove manual, paper-driven processes to speed approvals, reduce errors and free up teams to focus on higher-value work.

Leverage data to tailor supplier outreach. Use AI-powered predictive analytics to identify the best candidates for accepting digital payments, then target enablement efforts accordingly.

Build proactive fraud defenses. Recognize that gen AI increases the impersonation risks. Deploy AI monitoring and self-healing operations to detect anomalies and stop fraud earlier.

Pilot and scale virtual card programs. Test virtual card solutions such as Card by Mail to overcome onboarding barriers, increase acceptance and unlock new revenue and control opportunities.

The time has come for AP teams to move beyond manual routines. Adopting AI technology can convert the traditionally costly afterthought of AP into a source of liquidity, resilience and strategic value.

Every paper check costs roughly $8 before accounting for fraud risk and reconciliation delays. Virtual cards eliminate those costs while giving real-time cash flow visibility. The companies winning today use AI to predict which suppliers will adopt digital methods and strategically migrate their entire payment ecosystem. That’s how you turn AP from a cost sink into a competitive advantage.”

Ernest Rolfson
CEO, Finexio