More businesses are turning to automated payments, a shift that is streamlining banks’ manual workflows to process their commercial clients’ accounts payable (AP), according to a recent report by MineralTree.

MineralTree automates AP for middle-market businesses and financial institutions, working with banks such as Truist Bank, Union Bank, CNB Bank and Umpqua, among others. Founded in 2010, MineralTree processes about $8 billion in payments annually.

As the total mix of electronic to paper-based payments shifts — business report paying 56% of invoices electronically and 44% with paper — more companies are automating their AP processes, according to the “State of Accounts Payable Report” published last week. The report findings are based on survey responses of more than 1,300 finance executives and middle-market professionals.

Businesses have begun to automate their AP processes this year at a rate of 38%, compared with 24% last year. That momentum is expected to continue, as another 20% reported prioritizing AP automation within the next two years.

People’s United Bank, which has nearly $60 billion of assets and operates branches in the Northeastern U.S., is one such bank benefitting from automated AP. It has been working with MineralTree for “a handful of months,” to automate commercial clients’ AP process, including invoice receipt, payment and reconciliation, said Cris Sigovitch, senior vice president of treasury management at the bank. With business clients adopting automation, the bank has seen a lift in operational efficiency and increased visibility into the AP process, he said.

For People’s United, the result has been a reduction in fraud exposure, allowing employees to be reallocated to more “high value-added tasks,” Sigovitch said. Amid COVID-19, the removal of paper from the AP process has been beneficial, he added, especially as a portion of the bank’s workforce continues to work remotely.

“The evaluation of any solution really causes you to identify all the different pain points you have within your organization … and the identification process of all the different steps, how you manually take in an invoice, how you manually route that through your organization, the time it takes for that entire process to happen … is significantly improved,” Sigovitch said.

In addition, People’s United is afforded more visibility into the AP process, including which invoices are in the queue, where the payment is, and the approval workflow in real-time.

Other banks are seeing electronic B2B payments rise amid the pandemic and e-commerce payment companies are seeing growth in volume. Zelle, the digital payments network backed by Early Warning, has seen a 250% increase in businesses signing up for the platform to make payments, in line with the increase in online transaction volume on Checkout.com’s platform in May.

Though, while banks continue to support paper check processing, the quantifiable return on investment is tricky to realize. “There’s still so much required in the financial services infrastructure that supports those payments, that we are a little bit away from being able to realize the cost savings from the move and adoption to electronic payments,” said Michelle Ziolkowski, head of global payables in treasury management at Wells Fargo, which is seeing a surge in automated and electronic payments.

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