Processing payments externally adds layers of complexity and manual effort to your accounts receivable workflow.
In this article, we'll explore what processing payments looks like within Sage using an integrated payments solution versus doing so manually.
Sage Intacct is a popular choice of accounting software among finance professionals, because it helps finance teams manage a broad range of activities across HR and payroll, and financial planning and analytics.
This cloud-based enterprise resource planning (ERP) software even has a tick of approval from the American Institute of Certified Public Accountants (AICPA), as a preferred financial management solution.
However, if your finance team accepts and processes payments outside of your Sage Intacct instance, it’s likely your team has experienced frustration carrying out important accounts receivable (AR) tasks. Sage Intacct helps you manage the majority of your financial operations in one place, but the actual processing of payments happens outside the platform.
But, this doesn’t have to be the case. Integrated payments technology can embed payment processing capabilities directly into Sage Intacct, helping you reduce manual AR tasks, speed up collections, and save on credit card processing fees.
When you process payments outside of your primary accounting system, that adds more manual work to your AR workflow as you must spend time updating customer records and reconciling multiple sources of information.
In this article, we’ll explore what Sage payment processing looks like when done manually vs. with an integrated payment solution. You’ll learn:
3 problems with manual payment processing in Sage Intacct
Here are some common challenges that AR teams might experience if they don’t have a way to integrate their payment processing with their Sage Intacct instance.
1. Slower collections
Manual AR processes slow payments collection by as much as 67 percent. Without any kind of integrated workflow for your payment acceptance, your AR team will spend much of their time updating entries in your accounting system one by one as payments come in. Not only is this likely tedious work, but it also slows down your collections and cash flow.
Without integrated payments, AR teams are likely using multiple third-party systems to process a transaction, meaning it can take longer to accept and process payments. In using these multiple systems, AR staff will have to pull information like bank reconciliation files from several sources, which can limit the time they have available to spend chasing late payments.
Delays in applying payments to their respective invoices in Sage could also mean AR teams can’t replenish customer credit efficiently, preventing customers from buying more.
2. High processing costs
In processing payments outside of Sage Intacct, businesses also leave money on the table. Manual payment processing deprives finance teams of an important driver of payment processing savings: interchange optimization.
Interchange optimization is the practice of improving the conditions of a transaction to secure the lowest possible interchange rates (the fees that make up the bulk of payment processing fees). This is done by sending additional payment transaction data like invoice line-item details along with every transaction.
Considering that on average the cost of facilitating credit card payments is 2% of every transaction and around 80% of this comes from interchange fees, interchange optimization is an invaluable tool for B2B merchants.
3. Errors of commission
When you have to update payment details in Sage manually, you also increase your risk for ‘errors of commission’— the mistakes that happen while recording or posting a transaction. Maybe the wrong amounts have been posted, the totaling or carrying forward is off, or the balancing is wrong.
Most AR professionals are vigilant about spotting errors. But unfortunately, manually processing and posting payments means some level of error is inevitable.
3 benefits of integrating payment processing within Sage Intacct
Working with an integrated payment processing partner can go a long way towards solving the problems we’ve just outlined.
After integrating their payment processing with Sage Intacct, accounts receivable teams can expect:
1. More satisfied customers and staff
Rightly or wrongly, customers often judge vendors on their billing and payment experience. Many integrated payments providers give you the tools to accept customer payments online right when they receive their invoices, making for a more convenient payment experience.
And because the integration with Sage Intacct means ledger entries are updated automatically as payments come in, your team spends much less time on manual cash application. Customers win. And your team wins.
2. Greater savings on processing fees
Spend management becomes easier too, when you can accept payments for all your sales channels in one tool and minimize payment processing costs with Interchange Optimization and Level 3 data processing (the highest level of data you can send to qualify for lower rates).
An accounting system like Sage Intacct is already home to data that’s helpful for interchange optimization (what industry your customer is in, where a product is shipping to and from, invoice details). A payment processor that can access that information through an integration with your Sage Intacct instance makes supporting Level 3 processing very easy.
3. Heightened payment fraud prevention
American businesses experienced an estimated $11 billion worth of losses due to credit card fraud by the end of 2020. With integrated payment processing, sensitive cardholder data is tokenized and passes through just one system, limiting the amount of hands that information needs to go through. With fewer entry points for potential bad actors, this helps you protect your customers and business from payment fraud.
An integrated payments solution that has additional security measures like optional checkout solutions for your ecommerce page can also help with limiting fraudulent chargebacks.
How DeVere Insulation automated payment acceptance within Sage Intacct
The accounting team at DeVere Insulation, an independent insulation contractor, is well acquainted with the challenges of processing payments outside of Sage Intacct. Their credit management team estimated they were spending 75% of their time on paper mailings, customer calls, and manual collections.
After implementing Versapay to integrate their AR workflows with Sage Intacct, DeVere regained that time for the AR team. Ever since, they’ve been able to speed up their posting of payments and accelerate collection times with click-to-pay invoices sent automatically from Sage Intacct.
How to process payments directly in Sage Intacct with Versapay
Versapay is a Sage Intacct partner, meaning you can easily add integrated payments to your existing Intacct instance. Here’s what integrated payments can look like in Sage:
Email click-to-pay invoices
With Versapay’s integrated payments solution for Sage Intacct, you can send invoices to your customers via an email containing a ‘pay now’ button. Once you create an invoice in Sage, customers will automatically receive an email with a secure link where they can pay online right away. They don’t even need a login to do so.
Your customers can pay one or more invoices in full using preferred payment method or view all their invoices to tailor their payment amount.
Accept recurring payments
You can also handle recurring payments, by letting your customers automatically pay invoices in daily, weekly, or monthly batches via credit card or ACH. This can greatly streamline collections and subsequent reconciliations. It’s especially great for your business if your revenue model revolves around subscription billing.
Auto-apply customer payments
Perhaps the greatest time saver of integrated payments is that payments automatically get posted to the sales invoice list in Sage Intacct, which can then be posted to the customer ledger. This makes applying payments to corresponding invoices much simpler for your AR team. You can choose which accounts the payments should go to, making settlement flexible.
Get paid across all sales channels
You can accept credit cards, debit cards, ACH, virtual cards, and bank payments across your sales channels, such as invoices, payment gateways, and ecommerce carts. Card refunds can also be handled with ease directly inside Sage Intacct. Customers’ payment methods can be saved—with all card data tokenized and encrypted—to make future payments easy.
Learn more about Versapay’s integrated payments solution for Sage Intacct here.
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