Making a payment feels like the end of a journey.
The business has done so much to find a vendor, compare against competitors, and put in the order for just what you need. As a result, how you pay can get pushed to the wayside as you’re focused on finalizing the transaction and moving on to the next thing.
But how you make a payment impacts your operations more than you might think.
The time and costs associated with payments are in your control. Making a change like switching to bulk payments can help you find new cost savings and efficiencies in your day-to-day operations.
What are bulk payments?
A bulk payment (or batch payment) is when you group multiple payments to different vendors to send at once rather than individually.
When you make a bulk payment, what would be multiple transactions are compressed into one. Depending on the payment method you choose, it will show up in the account as a single line item.
Once a payment is initiated, the funds are pulled from your account. They’re then broken up and sent to each recipient with no extra work on your end.
A common example of this is payroll. The funds get pulled in a batch before being deposited into each employee’s bank account.
Making bulk payments requires a tool, software, or API that enables it. For example, BILL lets you pay up to 200 bills in a single batch using a variety of payment methods.
The advantages of bulk payments
Making the switch to bulk payments can save you time and money. Let’s look at exactly how.
Cost savings
Multiple payments count as multiple transactions. With bank accounts potentially charging fees for certain transaction types or going over a set transaction limit, a bulk payment saves you money by minimizing the fees per payment.
With how per transaction fees work, the more payments you batch together, the more money you save.
Considering that these savings happen every month, making the change to bulk payments pays dividends in perpetuity down the line.
Improved efficiency
Going through the approval and payment process for each invoice means repeating a lot of similar steps.
Bulk payments save you from having to repeat the final step of making payments for each invoice you’re paying.
Imagine if instead of writing 15 checks for 15 outstanding invoices you could pay them all in one fell swoop.
Implementing bulk payments can revolutionize your accounts payable process, save you time, and increase the speed at which you close out invoices.
Fewer errors
Bulk payment systems will help you make fewer errors through two highly important functions.
Automation helps make the payment process a hands-off experience while cutting down on manual processes that are prone to errors. Simply set up the payment once and have peace of mind that the correct amount is being sent to your vendors ahead of the due date.
Validation checks are often included in bulk payment systems. They verify payment details, vendor information, and amounts by checking them against past payments or documentation like a purchase order.
By taking full advantage of these features, you’ll cut down on errors and make payments with full confidence.
Streamlined reconciliation
Accounting teams are regularly reviewing transactions, going line-by-line to ensure the books are balanced and activity is accurately recorded.
Sending individual payments results in them having to comb through hundreds or thousands of transactions, adding unnecessary stress and work onto their plates.
When you switch to a bulk payment system, you cut down the workload for account reconciliation and streamline multiple parts of the process. You reduce the number of transactions to reconcile and all documentation is securely maintained in the platform.
Cutting out these tasks helps your accounting team focus their efforts on more valuable work.
How to integrate bulk payments into your operations
Once you’ve decided to use bulk payments, follow these steps to seamlessly integrate them into your day-to-day operations.
Step 1: Assess your needs
Before you jump head-first into shopping for a bulk payment solution, you should spend time considering what you want out of it.
How many payments will you be making in a month? What’s the overall dollar value? What payment methods will you need to use? Will it integrate with your tech stack?
These questions are your absolute necessities. If an option can’t meet your transaction volume or make payments that work for your vendors, they aren’t going to add value to your operations.
Once you’ve established your needs, you can start thinking about the “nice to have” features.
Step 2: Browse your options
Make a list of potential options that meet your needs. Start to list out their unique features and what the pros and cons for each are.
Many software providers offer demos or consultations so you can get a better idea of how it will work in practice.
You can book a demo of BILL to take a deep dive into our platform and see how it allows you to streamline multiple aspects of your financial processes.
Step 3: Choose your provider and begin setup
After you’ve shopped around, commit to the option that best suits your needs. Once you’ve got access, it’s time to start entering basic information to get the setup started.
Be sure to give access to all team members who will be using the tool right off the bat. Having multiple eyes on the initial setup ensures you’re not making any errors and you can delegate tasks to make it go faster.
Step 4: Integrate with your accounting system
By connecting your bulk payment system with your accounting system, you ensure payment and transaction information is shared and consistent between the two platforms. Not only does this cut down on work, but it also reduces pesky errors from human entry.
Step 5: Connect your bank account
Before you start sending money, it needs to come from somewhere. Connect your preferred bank account and consider sending a test payment to make sure it’s working properly.
Step 6: Set up vendor accounts
Add in the vendors you’ll be making payments to. Enter their payment information as well as any internal controls to keep payments safe and accurate.
If you have any outstanding invoices, making a payment is a good way to test if the system is working properly. Give your vendor a heads-up that you’ll be using a different payment platform and they can alert you if the process doesn’t work as intended.
Step 7: Schedule recurring bulk payments
Get your first recurring payments set up and scheduled for their payment dates. Each payment you set up as recurring is more work saved and more value generated from making the switch.
Step 8: Monitor activity
As much as bulk payment systems have controls to protect you from costly mistakes, you should still review payments as they happen over the first few months to make sure everything is working as expected.
Set reminders in your calendar for when payments are scheduled. After payment has gone through, check it came from the correct bank account with payouts going to the intended vendors.
You can also review activity as you reconcile transactions.
Step 9: Review and optimize
As you spend more time with your new tool, you’ll learn new tips and tricks that help you get the most value.
Consider setting a meeting with all users a month after the tool was implemented to solicit feedback and find out if there’s anything they’re struggling with.
Over time, you’ll refine your process and streamline workflows to save even more time compared to the manual process you had before.
Potential challenges of bulk payments (and how to solve them)
Making a switch to bulk payments doesn’t come without its potential challenges. Look out for these potential pain points and use our tips to solve them.
User training and adoption
As is always a risk with change, some users may resist the new ways of doing things or don’t get sufficiently trained on how to use it properly.
In both cases, the time to adoption and successful implementation extends meaning more time before your business starts reaping the rewards of the change.
To combat this, host a kick-off training session with key users and stakeholders so everyone is on the same page about how the tool is going to be used.
These training sessions should be accompanied by clear documentation and step-by-step process guides that users can refer back to.
Incorrect setups
There will be multiple moving parts when migrating over to a new payment solution.
First comes importing your banking information and that of your customers. Then comes integrating the platform with your other accounting tools.
An improper setup can stem from a misunderstanding or simply human error. That’s why it’s important that no matter how confident someone is in setting up the platform, there’s a second set of eyes to verify the completed work.
Don’t forget to also leverage as many online guides and resources are available, including a customer support line if you have questions you feel like you can’t find the answers for.
It’s also best practice to take your time and communicate with your clients that this switch is being made. It lets them know to flag any issues to you and that you’re ready to work through them to find the solution.
Failure to integrate with your tech stack
You’re making the switch to bulk payments to gain efficiency, not create more work. If you choose a platform that doesn’t fit naturally into the technology you’re already using, you may find yourself doing enough additional upkeep that it offsets any gains.
This is why one of the first criteria you should have when looking at bulk payment solutions is a tool that integrates with your tech stack. You need a seamless flow of information to and from your accounts payable solution and your accounting software that keeps reports up-to-date.
If you’re still using Excel sheets or a rudimentary accounting platform, this might be the time to make the switch. By revamping both, you open up a whole new world of automated accounting and payments that will win you back hours of work every month.
Bulk payments in tandem with a full suite of tools
Switch to a financial operations platform that does more than just make payments.
BILL is a platform that helps you unlock a new level of financial reporting at a fraction of the work. With tools that save you time on accounts receivables and accounts payable, budget planning, expense management, corporate cards, and more, you get a full suite of value that will elevate your team to the next level.
See how BILL can help you manage bulk payments for your business.
