Late payments are an ongoing problem for Australian businesses. If you’re a business owner, you’ve probably seen the statistics and felt the effects of these in your own business. When you’re waiting on late payments to reach your bank account, you likely need to delay payments you owe. It creates a downstream flow-on effect and cycle of late payments across the supply chain.
The process of dealing with late payments shouldn’t be inefficient and stressful, but without adequate systems and processes in place it can get out of hand quickly. In this article, we outline the best way to put a stop to late business payments and cashflow issues, leaving you with more time to focus on growing your business.
Key problems with Australia’s B2B payments
PwC’s report, Future of payments in Australia, outlines the key expectations businesses have for payments today and into the future. Businesses today want to address the complexity of dealing with and paying their suppliers while having better visibility over their cash flow. And, in the future, presumably once vendor and cashflow visibility issues are addressed, businesses want to integrate their payment processing systems with the rest of their business. Further down the track, a business can use the data from these integrated systems to make stronger commercial decisions.
By setting up proper systems and processes now, a business can not only address its immediate cashflow problems, but can enjoy the benefits of fully integrated payments as well.
Set up the right systems to stop late payments in the first place
Many businesses pay their invoices late because they’re waiting on late payments to hit their bank accounts, too. You can address this problem by setting up systems that provide your customers with a range of payment options, including integration with their accounting system, giving them better visibility over their cashflow. Think about the systems you have in place to collaborate with your team or customers on your work. It makes sense to have tools that allow you to securely collaborate on payments too. Spenda helps businesses address these problems to enable stronger cashflow and the ability to be more strategic.
Give your customers payment options and you’ll both enjoy stronger cash flow
When you’re shopping as a B2C consumer, one of the things you may have enjoyed is the range of payment options available. With credit card payments and buy now, pay later (BNPL) services, you can effectively provide yourself with an extra 30 to 60 days to pay for your goods and services. Solutions like Spenda, deliver flexible payment features that provide businesses with a range of payment options and automated ledger-to-ledger collaboration so both buyer and seller are always working from the same source of information. And allowing businesses to pay via credit card or with BNPL options provides extended credit terms too (standard payment terms plus a credit card’s interest-free period or total time to pay all BNPL instalments).
Businesses should be able to access the same convenience and control over their cashflow that B2C payment platforms provide. Spenda’s payment feature provides several payment options, including:
- Credit card payments: Securely pay one or multiple invoices in a single transaction with immediate settlement available for a small fee. All credit card transactions are tokenised, which provides extra security as your customer never needs to share their credit card details.
- Bank transfers: Payment via bank transfer with the ability to pay one or a selection of invoices in one transaction. Ledger-to-ledger integration means you’ll both know exactly which invoices have been paid and what’s outstanding.
- BNPL: With our BNPL feature, your customers will have access to a third-party finance provider. You’ll get paid straight away while they’ll be able to pay their invoice over a set number of instalments.
- Workflow payments: No one likes having to return to their desk at the end of the day to send a bunch of invoices. Spenda’s workflow payments concept allows businesses to get paid as soon as goods and services are delivered, or a pre-set event is triggered.
By offering the above payment options in the first place, your customers can align their payments with their cash flow. This addresses one of the key causes of late payments in Australia while having positive impacts on cash flow across the supply chain.
Align cashflows across supply chains to better your business
When customers can schedule their payments from the start of the transaction, they’ll be able to make sure they have adequate funds to pay, while you know exactly when to expect payment. This provides both parties with more control and visibility over cashflow. If you’re getting paid faster, you won’t have to delay any of your payments, and this trend will continue with your suppliers and their customers, too.
Set up automated systems to deal with late payments quickly
Even with a range of payment options available in your business, we understand that some accounts may still pay late, so it’s important to implement smart digital tools to help address this problem, too. With Spenda, you can simply invite your customer to the platform, remind them their payment is overdue and they’ll be able to choose from a range of options to settle their account in full. The scheduled payments will be automatically deducted from your customer’s credit card or bank account, and you’ll both see exactly when these transactions will occur.
It’s important to note that, while you may feel stressed or worried about damaging the relationship with your customer by chasing up late payments, Spenda’s tools help you set up the systems and processes your business needs to settle any current late payments and significantly reduce, maybe eliminate, late payments in your business altogether.
Stop late payments in their tracks and boost your cash flow with Spenda
Chasing late payments is a hassle for business owners and finance professionals, but you can address the problem at its root with the right systems and processes. Spenda helps businesses make late payments a thing of the past while strengthening cash flow across the supply chain. Your customers will enjoy better payment flexibility, while you’ll enjoy getting paid on time, resulting in better visibility of the money flowing through your business.
Want to learn more about new innovations that are shaping the future of B2B payments and boosting cashflow management for Australian businesses? Download your free whitepaper copy here.