Why Automatic Bill Payments Are Essential for Business Growth

Automatic Bill Payments Essential for Business Growth

An automatic bill payments process can save you time and money while supporting growth as you scale your business. Writing checks or paying bills online is time-consuming and wastes valuable business resources. Luckily, this archaic method is no longer necessary in today’s rapidly advancing business tech world.

You can set up automatic bill payments directly with vendors, suppliers, or financial institutions that your business works with. Automating bill payments means that your finance team doesn’t have to deal with the hassle of managing accounts payable (AP) tasks manually, so you can redirect their time and attention to more strategic work.

Here’s how automatic bill payments can save your team time and money, plus some helpful tips on which expenses you should automate.

Disadvantages of Manual Bill Payments for Growing Companies

There are several downsides of of paying your bills manually. Fortunately, they’ll disappear once you implement expense management automation.

Labor

Organizing bills and writing checks is a tedious and inefficient use of your employees’ time. If you’re in growth mode, making sure your team is focused on critical tasks is essential in order to scale your business. That’s why it’s crucial to reduce the time they’re spending on unnecessary manual work.

Resource Costs

Ordering checks, envelopes, and postage is expensive. If you remove the need for these costs, your company’s assets can be utilized for more worthwhile purposes.

Errors

Manual work always carries the risk of human error. Automating your bill payments can reduce the likelihood of mistakes when writing checks, addressing envelopes, and paying for postage.

How Automatic Payments Can Help Grow Your Business

Setting up automatic bill payments from your bank account or with a company credit card saves time, builds business credit, and is eco-friendly. These advantages can have far-reaching effects on your company, especially when it comes to scaling up.

Saves Money & Time

Here are a few ways that automatic payments can save you time and money:

  • Avoiding late fees and additional interest charges on outstanding balances.
  • Reducing labor costs, which allows the accounting department to focus on more important tasks such as receivables and timely reporting.
  • Reducing the review time of payables and the need for signatures, which gives decision-makers more time to focus on growth opportunities.

Builds Business Credit

  • Using credit cards for automatic bill payments establishes good pay history and results in increased credit lines.
  • Reporting of “good standing” by creditors gives other creditors a glimpse into the company’s payment history and credit worthiness.

Eco-Friendly

  • Reducing the need for checks by using paperless payments is environmentally friendly and offers additional cost savings.
  • Avoiding the waste of valuable company resources such as envelopes and postage is another eco-friendly process enabled by virtual payment automation.

When to Automate Business Bill Payments?

There are some important factors to consider when it comes to automating financial processes for growing companies. Oversight and cash flow are concerns that should be addressed in full before implementing automatic bill payments. It’s necessary to review bills periodically to avoid unexpected increases in fees, subscription costs, and payment amounts that could result in cash flow issues.

Good planning and knowledge of how cash flows throughout the company can help you avoid bank fees due to things like insufficient funds and overdrafts. It’s also crucial to avoid maxing out credit cards to ensure that bills are paid without interruption.

Planning and monitoring are part of internal control processes that should also be applied to automatic bill payments, in order to safeguard company assets and resources.

Which Expense Payments Should You Automate?

As your company grows, so does the number of payments and bills you’ll need to make, so financial automation becomes increasingly important. You may want to set up automatic bill payments for fixed expenses, including:

  • Rent
  • Mortgages
  • Business loans (including auto loans)
  • Business insurance premiums
  • Recurring software subscriptions and SaaS tools

It’s important to exercise caution with automated expense management, as expenses with variable costs should not always be included in the automation process.

Accounting Automation Is Key

For full growth potential, companies should also consider the benefits of accounting automation beyond bill payments. Automating and improving the overall accounting process can help you reduce errors and labor costs, and give you real-time data on company payments.

Automating bill payments is a great way to save time and money, but it’s just one of the many ways you can use automation to increase efficiency at your company.

  • Get the latest blogs from Mesh by subscribing to our newsletter

Manage Your Payments With Full Control & Visibility

Take Control of Your Spend
Manage Your Payments With Full Control & Visibility