Spenda 16 March - 4 min read
The payment processing industry has progressed rapidly in recent years, particularly for business to consumer (B2C) transactions. Platforms that offer integrated payment technologies for businesses to business (B2B) transactions are also becoming more widely adopted, allowing businesses to accept online payments and transform the way in which they trade. One of the most significant developments in B2B transactions in recent years is the integration between payment transaction processing and accounting software. This integration improves data sharing and management across businesses and forms the foundations for improved cash flow.
This article outlines what integrated payments and ledger-to-ledger postings are, and why these are important for your business.*
Integrated payments automate payment acceptance, allowing businesses to accept a range of payment options within their other business systems, such as ERP or accounting software, customer relationship management systems and e-commerce stores. To fully understand how integrated payments provide an array of benefits to businesses and customers alike, it’s important to remember how a business’s transactions and accounting processes took place before and after these technological developments.
Before integrated payments technology was introduced, merchants would have to wait for batch reports from their transaction providers. Once received, the merchant would manually enter each transaction from the report into the business’s accounting system. This process was time consuming, inefficient and increased the risk of human error - impacting the account reconciliation and financial reporting process.
With the range of technology available to businesses today, there’s an expectation that customers will have multiple payment options, whether they are completing a B2B or B2C transaction. Accepting card and mobile payments is no longer a “nice to have” option; it’s a necessity. Providing these payment options and implementing an integrated payment system means transactions can be recorded automatically and in real-time. This increases efficiency, improves reconciliation and financial reporting accuracy which leads to better cash flow.
Ledger-to-ledger postings automatically pulls data from one part of the business to update other systems where the data needs to be recorded. For example, suppose your business has an integrated payment system. When you pay a supplier, this transaction will automatically record in your payment system, accounting software and other systems such as service and inventory management systems. If your supplier also has an integrated payment platform, it will be automatically updated across their systems as well.
Ledger-to-ledger posting reduces the need for manual data entry and potential costly mistakes while also providing powerful insights for your business. You can use these insights to better manage your cash flow, get paid faster, implement just in time inventory ordering and automate your account reconciliation and financial reporting processes. Automating your business processes also provides you with more time to focus on the strategic aspects of your business.
What can you expect from payment processing integration?
Payment processing integrations allow transaction data derived from electronic payments to automatically record in a business’s accounting or ERP system when a transaction occurs. Key benefits of integrated payments include:
Choosing the right tools and solutions for your business
Invoicing your customers is important, but getting paid is the most important factor in owning and operating a profitable business. Integrated payment platforms such as Spenda help businesses of all sizes to provide more payment options to customers, facilitate faster payments and ensure a more secure environment for both parties in each transaction. With the functionality to merge with other systems and processes, integrated payment systems can transform your whole business.
Spenda: Providing smart solutions for your business
Spenda provides business owners with the tools and systems they need to strategically manage their operations. With integrated payment systems working seamlessly with other parts of your business, you’ll have all the rights tools to strengthen your business at your fingertips.
Making big changes to how you run your business can feel daunting, but we’re here to show you that introducing integrated systems to your business can be seamless, improve your cash flow and give you the information you need for strengthened systems and processes.
Spend less time sweating the small stuff and more time planning and strategising inspired changes to your business. Click here to book a demo and learn how integrated payments can transform the way you manage your business.
*This article is for general information purposes only. Consult a qualified financial advisor regarding any changes to or decisions about your business’s finances.
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