What are integrated payables? How it works and benefits

Managing separate systems for each payment method, from virtual cards to checks to ACH payments, is slow, cumbersome, and error-prone.

That’s why many companies opt to use integrated payables instead.

In this article, we’ll explain what integrated payables is, discuss how it works, and outline important steps to start using it in your own organization.

What are integrated payables?

Integrated payables is a solution that combines different payment methods—such as checks, ACH, and virtual cards—into one automated process. It helps businesses handle all vendor and supplier payments from a single platform, making operations more efficient and cutting down on costs.

Integrated payables systems are made up of five core components:

1. Unified payment hub: Centralizes the disbursement of different payment types from one interface.
2. ERP/AP system integration: Syncs with accounting software to pull invoice data and push payment updates.
3. Approval workflows: Ensures payments follow internal controls and are authorized by the right stakeholders.
4. Remittance delivery: Automatically sends detailed remittance information to vendors through preferred channels.
5. Reporting and reconciliation tools: Tracks payment statuses and simplifies month-end close with real-time visibility.

Benefits of integrated payables

Moving from traditional AP to integrated payables helps improve financial operations by replacing fragmented, manual processes with a unified, automated system.

1. Cost savings through automation and electronic payments

By automating approvals and using lower-cost payment methods, you’ll reduce:

• Labor costs
• Check-handling fees
• Payment errors 

2. Improved cash flow management and visibility

By leveraging real-time payment tracking and forecasting tools, you’ll manage outflows more precisely and avoid missed deadlines and the need to access overdrafts.

3. Enhanced supplier relationships and payment experience

When using integrated payables, your vendors will receive faster, more consistent payments, along with detailed remittance advice (sent automatically).

This will help you improve vendor trust and reduce the number of payment inquiries your team has to handle.

4. Stronger internal controls and audit readiness

Role-based approvals and digital audit trails provided by integrated payables systems help simplify compliance and reduce your risk of being a victim of fraud.

5. Scalability as your business grows: 

Integrated systems reduce the burden on accounts payable teams, making it easier to scale payment operations without increasing headcount.

Challenges in implementing integrated payables 

The benefits of implementing integrated payables are clear and compelling, but that doesn’t mean getting from point A to point B will necessarily be easy, especially if you’re operating on legacy systems or are tied into manual workflows.

These are some of the most common obstacles you’ll come across during the transition:

• System compatibility issues: Older ERP or accounting systems may not support modern API integrations or require custom development.
• Data integrity concerns: Inconsistent or incomplete vendor data can disrupt automation and delay payments.
• Internal resistance to change: Teams accustomed to manual processes may hesitate to adopt new systems without clear incentives or training.

Integrated payables vs. traditional payment processing 

Traditional accounts payable processes are often fragmented, with teams manually handling different payment methods through separate banking portals, spreadsheets, or paper checks.

This standard and siloed approach increases the risk of delays, errors, and missed discounts through late payments.

Integrated payables, on the other hand, centralize and automate the entire payment lifecycle. Here’s how the two approaches differ across four dimensions.

1. Process efficiency

Traditional accounts payable relies heavily on manual input across multiple systems. Integrated payables streamline workflows using automation and consolidated reporting and payment management dashboards.

2. Payment types

Traditional AP setups typically require separate processes for each method of payment. Integrated payables allow all payment types, from ACH to card payments, to be issued from a single platform using a single process.

3. Visibility and control

Traditional accounts payable offers limited visibility across payment statuses. Integrated payables provide:

• Real-time tracking
• Audit trails
• Easier exception handling 

4. Cost and fraud risk

Manual processes increase costs (from check printing, postage, and resources required), and also expose businesses to potential fraud. Integrated payables use secure digital tools to reduce both costs and AP fraud risk.

How do integrated payables work? 

Integrated payables systems use automation, APIs, and secure payment gateways to manage the entire payment process through a unified platform.

These systems are connected directly to a company’s ERP or accounting software, thereby enabling seamless data transfer across the entire lifecycle, from invoice approval to payment execution.

The main technologies employed to enable integrated payables are:

• ERP integration: Syncs vendor details, invoice data, and payment statuses between systems in real time.
• Payment orchestration engine: Determines the optimal payment method (e.g., ACH, virtual card, check) based on vendor preferences and cost-effectiveness.
• Approval and compliance workflows: Enforces internal controls with configurable approval paths and audit logging.
• Secure payment rails: Executes transactions via bank networks, card issuers, or third-party processors using encrypted channels.
• Remittance and reconciliation automation: Sends remittance advice automatically and updates the ledger to reflect cleared payments.

How to implement integrated payables effectively 

Rolling out an integrated payables system requires more than just choosing the right software. It demands a structured plan, clean data, and strong change management to ensure the new process sticks.

Follow these steps to get started:

1. Map out your existing workflows, payment types, and system limitations to identify gaps and opportunities.
2. Ensure all of your vendor contact details, payment preferences, and banking information are accurate and complete.
3. Choose a provider that supports your ERP or accounting platform, offers good customer support, and enables multiple payment types.
4. Roll out your system to a small group of vendors or payment types to test functionality and resolve any small bugs or issues before scaling.
5. Set up approval chains, exception handling rules, and compliance parameters that reflect your internal policies.
6. Run training sessions for all team members involved, including finance, accounts payable, and procurement staff.
7. Put a process in place for tracking key metrics like processing time, cost per payment, and vendor satisfaction. 

Key features to look for in integrated payables solutions

On the lookout for an integrated payables platform to streamline payment management?

Here are the most important features to prioritize when weighing up your options:

• ERP and accounting system compatibility
• Support for multiple payment types (ACH, virtual card, check, wire)
• Customizable approval workflows and role-based access
• Real-time payment tracking and reporting
• Automated remittance delivery and reconciliation
• Strong customer support and implementation guidance

Best practices for a smooth transition

Once you’ve landed on a solution, you’ll need to head back up to the steps we explained above for effective implementation.

However, there are a few important best practices to bear in mind as you move forward:

• Communicate the “why” to your team early to secure buy-in
• Assign an internal project lead or champion to manage the rollout
• Document any new processes clearly and make sure everyone has access to documentation
• Schedule check-ins with your provider post-launch to resolve issues quickly
• Use vendor feedback to optimize the payment experience over time

Future trends in integrated payables 

As today’s emerging technologies become more and more commoditized, and expectations around speed, security, and visibility continue to increase, integrated payables will continue to evolve.

Here are some of the trends we should expect to see develop in the coming years:

• AI and machine learning: These tools are improving fraud detection, automating exception handling, and optimizing payment timing based on historical data and vendor behavior.
• APIs and embedded finance: Seamless integrations between platforms are making it easier to initiate and reconcile payments without switching tools.
• Blockchain and tokenized payments: While still fairly early right now, blockchain may play a role in enabling faster, more transparent cross-border payments.
• Predictive analytics: Payment systems will become increasingly intelligent, using predictive modeling to suggest optimal payment methods and timing.
• Self-service models: Vendor self-service portals will expand, giving suppliers greater control over how and when they get paid.
• Compliance requirements: Regulatory pressure and demand for ESG transparency will push more businesses to adopt digital, auditable, and environmentally friendly payables systems.

To stay ahead of the curve, businesses should continuously assess their tech stacks, build flexible workflows and vendor support into finance processes to avoid disruptions, and partner with forward-thinking providers that invest in innovation and automation.

Integrated payables solution for businesses

With BILL’s integrated accounts payable software, you can capture, match, and approve invoices, schedule payments with multiple payment methods like ACH and credit cards, and stay synced at all times with your accounting software of choice.

Get started with BILL today.

Frequently asked questions

What is the difference between integrated and non-integrated payment?

Integrated payments are managed through a system that connects directly with your accounting or ERP software, enabling automated workflows and real-time updates. Non-integrated payments are handled manually or through disconnected tools, requiring duplicate data entry and offering less visibility and control.

What is the difference between integrated and embedded payments?

Where integrated payments centralize multiple payment methods to improve internal efficiency, embedded payments are built directly into customer-facing platforms, so end users can complete transactions without leaving the app interface.

What are the industries that benefit most from integrated payables?

Industries with high invoice volumes, complex vendor networks, or regulatory scrutiny see the greatest benefit. This includes sectors like construction, healthcare, manufacturing, logistics, and professional services, where payment speed, accuracy, and auditability are critical.