Payment Software Solutions: Understanding The Spend Analysis Process


As financial managers explore new technologies to improve their payments operations, there is an increasing need to understand how to use those solutions to their fullest potential. One of the most powerful features any payment software solution offers is the ability to conduct spend analysis of bill payments. For C-suite professionals in the finance department, constructing spend analysis process can often seem like daunting task. However, with the right resources and guidance, it can be simplified into straightforward exercise. This guide seeks to provide clear instructions for comprehensive approach to leveraging payment software’s spend analysis process.

1. Establish Goals

The first step for any financial executive embarking on spend analysis process is to determine the desired outcome. Before beginning to investigate the payment software solution, the financial manager needs to have clear idea of the needs the analysis should be predicting or uncovering. Though precise goals will naturally be idiosyncratic to the organization and sector, in general the goals should center on understanding payment trends, identifying anomalies, and reducing costs.

2. Collect Data

Once the goals have been established, the financial manager should begin collecting data. The payment software will have facilities for data compilation, but the figure should be augmented with additional resources like bank statements and payment records. It is important to obtain at least several years? worth of information in order to gain proper perspective on the organizations payment history.

3. Sort Data

Once the data has been collected, it ishould be sorted into meaningful categories. This may involve breaking down data by payment type, supplier, payment method, or currency. By doing this, it is possible to gain an understanding of where and how payments are being disseminated.

4. Analyze Frequency

Another step in ‘slice and dice’ analysis of data is to investigate the frequency of payments. This is particularly helpful for uncovering payment discrepancies or anomalies for example, one-off payments that increase spending or the sudden change of supplier.

5. Categorize Expenses

Categorizing expenses is key for helping managers discern spending patterns and make data-driven decisions. While it can be lengthy process, categorizing expenses up front helps bring structure to the analysis and facilitates understanding.

6. Visualize Data

Another useful technique employed in spend analysis processes is to visualize the data. While there are many different tools available to do this, using payment software with built-in graphics capabilities greatly simplifies task. In any case, visualizing data will make it easier to uncover broader patterns and trends.

7. Compare Data Sets

Using payment software solution reduces the time and effort it takes to cross-compare data sets for correlations. It is important to use this feature to analyze the influence of factors such as currency, service providers and payment method (cash versus credit) on the organizations spending behavior.

8. Invoke Machine Learning

Most contemporary payment software solutions leverage machine learning AI to monitor payment patterns and alert financial managers to potentially problematic discrepancies or inefficiencies. AI can prove to be valuable asset in the analysis process, by streamlining data collection and optimizing performance based on context.

9. Optimize the Process

Once the initial analysis has been conducted and the finance executive has clearer understanding of the payment systems and its trends, the final step is to optimize the process. This includes leveraging the payment software’s features to automate mundane tasks, such as data entry, data validation, and payment reconciliation.


This guide has highlighted some of the fundamentals of the spend analysis process, as conducted through payment software solution. With data-driven insights, the financial manager can be better equipped to streamline the organizations payment operations, identify risk-prone suppliers, and save on transaction costs. Ultimately, payment software provides substantial benefits for the CFO, chief purchasing officer and other finance executives working in the payments space.