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How to stop chasing late payments and get paid quicker

Ola Polczynski
28 January - 5 min read

Despite innovation in payment methods offered to consumers, the way businesses pay each other has changed very little over the last 40 years. 

 Inefficiencies in operational processes and payments practices plague many businesses and directly contribute to cash flow problems. Not only does restricted cash flow mean businesses need to cover the shortfall of working capital while waiting for payments to process, but it also holds businesses back from growing altogether.

 Creating solutions to deliver less debt and improve cash flow

Today, new innovations in payments are able to bring about smarter ways for businesses to get paid quicker and drive better cash flow management for buyers and sellers. 

Business is rarely one-size fits all and more and more business owners have expressed the desire for flexibility and choice in how they pay their suppliers. Giving your customers more ways to pay will ultimately mean your business gets paid quicker.

Payment Options with Spenda:

Providing a highly functional payment platform for business is one of the key drivers at Spenda. With that in mind, we have been working hard to create flexibility that allows businesses to take control of their cash flow and take/make payments in the way that best suits them.

  • Payment passport – Centralised tokenisation means that Customers can manage their supplier payment methods from a single point. If your credit card changes or you wish to add another you have only one place to update for all of your suppliers.
  • Workflow Payments – Businesses can get paid for products and services at the point an invoice becomes due based on real work activity such as job or delivery completion, with verified customer payment details. the job is complete, or a delivery made, with verified customer payment details. With this infrastructure, friction is removed from the payment process and certainty is created in debt recovery for the seller.
  • Intent-to-Pay framework / Scheduled Payments – Allows customers to set a scheduled payment plan with their suppliers to settle debt. Customer arrangements which are sent to the supplier provide certainty around their intentions to pay.
  • Access to third party finance – Through our partnership with Invigo we can offer both buyer and seller initiated immediate payment of invoices. For the seller, this can be used as a tool to extend credit to customers and drive cashflow.  For the buyer, it can be used to create liquidity in their business, smooth seasonal purchasing profiles and manage purchasing within credit limits.
  • Unallocated Payments – Allow customers to make payments without allocating them to a specific invoice. The ability to pay money to an account rather than an invoice is an important functionality that allows the product to be more appealing to larger customers who traditionally integrate with ERP systems as opposed to small business cloud platforms like Xero and MYOB. The introduction of this feature increases the addressable market for SpendaCollect allowing us to target enterprise customers as well as the existing SME base.
  • Improved Bill Presentment – Q3 FY21 will see the launch of a Spenda bill presentation tool offered to merchants that will deliver customers more payment flexibility, lower transaction processing costs, faster settlement, multi-invoice payment and improved integration.

 How these new innovations benefit customers:
  • Pay your suppliers via credit card even if they don’t accept credit card payments – Use your credit card (including personal cards) to pay your entire accounts receivable using Spenda. Funds are then distributed to the supplier’s bank via the Open Banking network.
  • Enabling payment via cards for all suppliers – Small and medium businesses can shape their cash flow and take advantage of the 55 interest-free days available on most cards plus any Credit Card Reward points schemes.
  • Faster and simpler reconciliation of batch payments – Customer batch payments are allocated and posted directly to their accounts payable ledger. 
How payment innovations benefit suppliers:
  • Removal of merchant statement reconciliation – By itemising fund deposits and annotating the bank statement for all invoice receipts processed via the SpendaCollect payment service, suppliers can quickly reconcile merchants payments via bank feeds or traditional methods.
  • Faster Onboarding – Automated and accelerated AML and KYC onboarding process which allow buyers and suppliers to connect and process payments within 48 hours.
By establishing the right tools and processes, payments can be processed more efficiently. That way businesses will have the ability to realise faster payment times, along with providing a seamless experience for customers. 

Getting paid quicker with Spenda

Our collaboration framework is ultimately focused on connecting the buyer and seller through ledger-to-ledger integration to ensure they are working from a single source of digital truth.

These improvements to the payment options have been made possible due to the Business Payments Solutions Provider (BPSP) and Business Payment Aggregator agreements that we’ve recently entered into. Coupled with the Workflow Payments concept, we’re able to give businesses better flexibility and more options when it comes to getting paid.

Furthermore, under the ‘Intent-to-Pay Framework’, businesses can collaborate on a repayment plan, otherwise known as Buy Now, Pay Later, and automate everything so the supplier knows when they will be paid and both businesses have a better view of their cash flow. 

Click here to learn more about our payment offering and get in touch with us to see how we can tailor the best solution for your business. 

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Ola Polczynski