The Risk Of Not Using Automated Credit APplication Software For Order To Cash


For any business or organization, the accounts receivable (AR) department carries additional risk due to lack of automated processing of credit available in modern software solutions. Most organizations now use software for automated credit application processing to ensure the accuracy of both applied and available credit, as well as improve the customer experience. Without this system, organizations will be unable to identify patterns, evaluate the creditworthiness of customers, integrate with financial systems, or properly manage effective collections.

Many executives are increasingly aware of the risks associated with not leveraging software for automated credit application processing. In an order-to-cash process, the risks of manual input coupled with inefficient processes can be exacerbated. Of particular concern is that manual entry can lead to errors. Errors may result in missed payments, late payments, charges being applied to the wrong accounts, incorrect credits being issued, proper customer information not being identified, and extended customer disputes. Inefficient processes can further lead to order misprocessing and delayed payments that can have ripple effect through the entire supply chain.

The alternative of using software for automated credit application processing offers numerous benefits that improve both customer experience and financial stability. Automating the credit application process decreases operating costs, reduces preparation and data entry time, streamlines data entry, and improves accuracy of information. Not only do automated processes reduce errors, some software solutions allow users to score customers to assess creditworthiness and set credit and payment limits. Additionally, real-time accounts receivable, collections, and recovery analytics provide an in-depth understanding of customer behavior and can unlocking further value when properly utilized.

The potential risk to an organization for not employing such software solutions is far greater than any cost associated with them. Utilizing automated credit application processing software allows businesses to improve customer experience, receive payments more quickly, and better manage financial accounts. Executives should carefully evaluate the software solutions available to ensure they are taking full advantage of the options available to optimize their order-to-cash process.