Accounts receivable serves as a critical driver of growth by converting sales into cash flow. However, many companies continue to rely on slow, manual processes, with PYMNTS Intelligence data indicating that 35% of mid-sized firms remain entirely dependent on them.
These manual workflows, often involving paper checks and data entry, are prone to inefficiencies and errors. Versapay identified human error in manual data entry as a leading cause of invoice disputes and payment delays. This widespread reliance on manual procedures, especially among small to mid-sized businesses where over 75% still manually chase collections or handle disputes via email, leads to significant operational challenges and cash flow uncertainty.
The direct impact on revenue from these manual processes is substantial. Manual invoice processing can significantly delay AR teams; a Versapay survey found that only 23% of CFOs report their teams are fully up to date on invoices, with many reporting being weeks or months behind schedule.
These issues disrupt operational efficiency and can lead to financial instability. For instance, 27% of respondents reported spending at least half their AR teams’ time resolving invoice disputes.
Despite CFOs increasingly recognizing the value of advanced technologies to reduce payment uncertainty, a significant majority of businesses have not yet fully automated their payment processes. Nevertheless, automating AR processes is presented as a crucial means to improve payment timeliness, reduce costs and accelerate cash flow.
Key data points from the report underscore the challenge and opportunity:
- AR automation can significantly reduce collection times, with PYMNTS Intelligence research indicating a potential 67% reduction for companies embracing these solutions.
- Despite acknowledged benefits and the urgency of financial agility, only 17% of businesses surveyed have fully automated their payment processes.
- The prevalence of late payments is stark: 86% of businesses report that up to 30% of their monthly invoiced sales are overdue, creating a serious drain on cash flow.
Beyond the quantifiable benefits, the report explores the strategic imperative of AR automation for 2025, with Carey O’Connor Kolaja, CEO of Versapay, asserting that “financial agility is no longer optional — it’s a necessity.”
She highlighted how manual processes, such as reliance on checks for nearly 40% of B2B payment volume in the U.S., create friction and vulnerability, even to disruptions like natural disasters.
The negative impacts of late payments extend to straining B2B partner relationships — cited by 26% of respondents as a reason for ending partnerships — and affecting broader economic stability. Automation, according to Kolaja, offers a competitive edge to firms by removing cash flow barriers, eliminating operational chaos and restoring financial control through data-driven decisions and personalized outreach.
R.J. Ancona, vice president and general manager, B2B product, partnerships and client management at American Express, added that while changing payment processes can seem daunting, the time and cost of automation are often “easier to implement than expected” and offer both short-term and long-term benefits.
The report concluded with an actionable roadmap for companies, emphasizing assessment, goal setting, strategic partnerships, scalable solutions and continuous refinement to optimize AR for future growth.
