XML invoices, which digitize the data on the invoice, are only a fraction of total invoice volume. The rest come in a variety of formats, including PDF and, of course, paper. And just because a PDF may be technically an “electronic” format, it presents many of the same challenges as paper — i.e., the need for manual extraction and entry of the data on that document.
Businesses large and small are looking to migrate to the digital world, said Unifiedpost CEO Hans Leybaert. But small- to medium-sized businesses (SMBs) especially struggle to make the shift because they continue to receive so many paper and PDF invoices.
Speaking with PYMNTS, Leybaert discussed the value of document digitization technology enhanced through artificial intelligence (AI) to not only automatically capture the data on procurement documents like purchase orders and invoices, but to streamline the payment on an invoice and even predict cash flow.
What It Means to Be Digital
SMBs often lack the resources to embrace systems that can generate and issue truly electronic purchase orders, and they similarly often lack the leverage to require their own vendors to issue electronic invoices. The result is a lot of paper and PDF documents, which creates a slew of challenges for the procure-to-pay workflow.
Both PDF and paper documents don’t send electronic data into back-end systems and require procurement professionals to manually re-key that information in the back office, leaving plenty of room for error. Further, in Europe, where Unifiedpost is based, there exists a diverse market of various languages that can make extracting electronic data out of various document formats particularly challenging.
While businesses have simply made-do with these challenges, the pandemic has heightened the need to embrace what it means to be truly digital.
According to Leybaert, SMBs have embraced the opportunity.
“In the past, people were a bit lazy in changing their processes towards digital,” he said. “Now, with the fact that they have to work from home, they have really shifted their mindset towards digital. They know they have to interact with each other in a fully digital mode. Once you’re in that mindset, then you look for the most optimal way.”
That not only means sending electronic versions of documents like purchase orders and invoices, but it means having the technology in place to automatically capture data on those documents and integrate that information into back-end systems, whether the documents are paper, PDF or otherwise.
The Opportunity in Data
To help SMBs ease into this transition, Unifiedpost announced a partnership with Google Cloud, a tie-up that sees Google Cloud’s Document Artificial Intelligence (DocAI) and optical character recognition (OCI) technology integrated into Unifiedpost’s existing offering.
The focus of the integration remains fixed on the procure-to-pay process, explained Leybaert, with opportunities to optimize this workflow as a result of the automation of data capture and entry.
One of the most prominent opportunities is in the arena of invoice fraud.
“The more you go digital, the more this channel is used for sending out invoices,” Leybaert explained. “It’s very easy to make PDFs and send invoices out for small amounts of money. There will certainly be people who pay without thinking, ‘What’s going on here?'”
Redirect fraud is another issue, in which hackers alter an existing invoice or generate an entirely fraudulent one with different bank account details on the bill. Automated data capture technology like that offered by Unifiedpost streamlines the process of checking this information and assuring that the invoice is legitimate and from a trusted supplier.
Once pre-payment checks for fraud and approvals are complete, this technology can also streamline the actual payment of invoices, Leybaert added, noting the company’s ability to create an environment in which procurement professionals can seamlessly pay the invoice that has been digitized within their systems, and have that transaction linked to their bank and other back-office portals for easier reconciliation.
“They can pay it immediately, without typing in data because it’s already extracted for them,” said Leybaert. “Payments becomes something natural, almost fully automatic, because we do the data extraction and checking of the invoice at the beginning of the process.”
The opportunities that can be found within procurement document data are vast, and Unifiedpost is looking to take advantage. Leybaert noted that, looking ahead, the company will be exploring cash flow forecasting capabilities that make use of the purchase order, invoice and payment data already at the company’s disposal.
AI will continue to be an instrumental role in that effort.
“Through artificial intelligence, we can do cash flow predictions, we can monitor the behavior of payers, which have direct implications on the cash that you have to pay your suppliers,” he said. “It’s all starting from that invoice data.”