Electronic Payments commonly called ePayments is the means of automating your supplier payments after processing in your ERP or AP System. ePayments is a means of moving from sending paper checks to ACH, wire and credit card. Some AP Departments try to automate their payments on their own. However what frequently happens is doing it on your own results in alot of effort and maintenance to support the process. Additionally the real benefit of ePayments is getting a large percentage of your suppliers to participate and doing the process on your own typically only results in a few of your key suppliers participating.
The trend we are seeing is using a third party ePayment provider to automate the process. Not only do they have dedicated people to contact and onboard new suppliers to participate in ePayments but third party ePayment providers already have a network of supplier built who are using ePayments many of which suppliers are ones your company uses also. This gives your company the benefit of immediately increasing your number of suppliers using ePayments being the suppliers that are part of the third party ePayment network are ready to do ePayments immediately with no effort on your part.
While there is a benefit to move suppliers away from a paper check cutting in any way possible, having a strategy of which ePayment forms are used can have significant savings. While ACH and wires are more economical that sending paper checks, using credit card as a form of payment provides the most savings being there is typiucally a rebate invoices for any credit card payment. While some suppliers refuse to accept credit card as a payment due to the supplier having to pay credit card fees, a surprising number of suppliers do accept credit card.