Top Banner
Is the lockbox an automated, value for money service? Why do organisations still feel that the lockbox is an automated, value for money service, where indeed it’s not! In the current climate of automation there are many more efficient and less costly ways of improving hit rates, and reducing costs. So imagine if you will the Credit Team. They receive a lockbox file, it is loaded into the ERP and they achieve a 70%+ hit rate with no work. Sounds great! BUT, if you are receiving a keyed service, beware, this comes at a very high cost. Let’s take a look at this… 1 It never fails to amaze me when I am told, “We get a 75% match rate from our lockbox”
4

Lockbox Automation in Cash Application. Is it really automation?

Apr 11, 2017

Download

Technology

rimilia
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Page 1: Lockbox Automation in Cash Application. Is it really automation?

Is the lockbox an automated, value for money service?

Why do organisations still feel that the lockbox is an automated, value for money service, where indeed it’s not! In the current climate of automation there are many more efficient and less costly ways of improving hit rates, and reducing costs.

So imagine if you will the Credit Team. They receive a lockbox file, it is loaded into the ERP and they achieve a 70%+ hit rate with no work. Sounds great! BUT, if you are receiving a keyed service, beware, this comes at a very high cost.

Let’s take a look at this…

1

It never fails to amaze me when I am told, “We get a 75% match rate from our lockbox”

Page 2: Lockbox Automation in Cash Application. Is it really automation?

2

Keystrokes – Banks of lockbox providers are charging you for every keystroke that you get on that file. Yes, every keystroke. So if your invoice number is 8 characters and your account number is 6 charac-ters… that’s 14 Cents for just one item. Now start to calculate if the customer sends a remittance with hundreds of invoices; you will get charged for every single keystroke of that

Exceptions – This can also be expensive, as the 30% that are not matching are be-ing charged for too and you are also us-ing your team to manage the exceptions! So, that’s a double charge

Delays – This can also be inefficient, especially at month end where the lockbox provider may take a couple of extra days to key at peak periods, again causing delays and costing you lost time and money, as well as poten-tially collectors calling customers who have already paid

Visibility – The bank or lockbox pro-vider are very smart, as they will gen-erally add these charges to the overall corporate banking service and it will appear as a line on the treasury report, being generally unseen to the collec-tions management team!

Robotic cash application software

Rimilia’s customers are starting to help with a revolution that is taking place in this process. They’re really starting to make a huge difference to how organisa-tions process cash application.

Page 3: Lockbox Automation in Cash Application. Is it really automation?

With Alloc8, Rimilia’s robotic cash application solution, customers can eliminate the expensive keying service all together, receive their cash faster, and truly au-tomate 95% + of incoming receipts straight through!

You can still use the lockbox to provide the check and remittance image if you choose, as Alloc8 will pick up this file and interrogate the data and then au-tomatch automatically to invoice level without the need for manual interven-tion, and without the need to pay keying fees!

Additionally, the image is kept for the audit cycle alongside the payment and can be retrieved easily in a single click!

The future of cash application

Over the next 5 years, payments will start to move further towards elec-tronic methods such as ACH, Wire and Faster payments, which is the norm in Europe. Using Alloc8, organisations get a 95%+ match rate, thus achieving a single world class process for all cash receipts.

3

Page 4: Lockbox Automation in Cash Application. Is it really automation?

So why not break away from this expensive, inefficient and manual process and move to a world class solution that will provide benefits from day one?

Rimilia is a global provider of robotic Accounts Receivable software with an advanced cloud delivered solution. Many blue chip global organisations are switching over to this simple, elegant and cost efficient platform.

To find out more about what we do and how we can supercharge your lockbox processes please visit the Rimilia website:

www.rimilia.com

or contact us on:

[email protected]+44(0) 1527 872123

4