Modern CFOs Leveraging New Fintech Strategies to Address Cash Management Challenges

April 4, 2017         By: Mike Dautner

As is stands, current low interest rates are forcing CFOs and enterprise finance departments to work harder and seek more innovative ways to drive greater returns to satisfy working working capital needs.

This is a new cash management imperative is actually kind of ushering in new disruptive approaches to transform Accounts Payable functions from cost centers to profit centers by uncovering its potential, and dispersing new and substantial revenue streams.

In today’s landscape, technology is revolutionizing the procure-to-pay process, providing the requisite velocity and transparency to support dynamic discounting, where suppliers proactively offer early payment discounts on approved invoices awaiting payment.

“While dynamic discounting has been in existence for several years, today it’s fast becoming one of the key tools of today’s new breed of innovative CFOs who are discarding the traditional practice of holding onto cash and delaying payments, which has proven to deliver inadequate returns in today’s fast-moving and demanding economy,” said Nilay Banker, founder and CEO of Inspyrus, which offers the only fully integrated AP automation solution on the market today, that enables invoice automation, discount management and supplier enablement – all from a single application. “Leading organizations are leveraging dynamic discounting to forge ahead with disruptive approaches that make early-pay discounts a real source of cash — capturing up to 2 percent of corporate spend directly back the bottom line and optimizing cash management in real-time.”

“Despite enormous opportunities for savings, most organizations do not consider dynamic discount capture a priority; as a result, CFOs following traditional cash management practices are losing out on capturing millions in extra revenues,” said Jimmy LeFever, director, Research and Consulting, PayStream Advisors. “Our data shows that companies successfully instituting a dynamic discounting program consistently net early-pay discount returns that significantly outperform comparative laggard approaches. In the current low interest rate environment, progressive CFOs will look to boost supplier participation in discounting initiatives as a savvy cash management strategy.”