Trends in Credit and Accounts Receivable Technology for 2025: Part 1

Businesses are forever seeking opportunities to gain a competitive edge and the current buzz around AI is evident all around - but most are watching and waiting.  The pace of change is so quick that shiny new things can quickly become obsolete, perhaps replaced with something even better that has substance and longevity. Picking through short-lived innovations to identify technology that can have a lasting impact often comes down to implementing practical solutions that can save time, reduce cost and optimise efficiency across the AR journey - but that can be enhanced with AI as it develops and proves its reliability.

They differ so vastly that a ‘one size fits all’ approach could never work. What is critically important in one credit process might not even need to be considered in another.  For example, if you are supplying large items of machinery on credit, PPSR is vital and being able to process credit card payments won’t feature. If you are selling fish to 700 restaurants every week, processing credit card payments quickly and easily will be vitally important and PPSR won’t.  

How and what a business sells, legacy systems, legislative constraints, labour resources and a hundred other factors all create intricacies that offer both opportunities to optimise performance and barriers to progress when it comes to installing the right technology.  Low or no code connectivity is a key consideration to support information flow into CRMs, ERPs, accounting systems, insurance brokers, debt collectors and many more of the connection points we see in modern processes. That’s why modular approaches have emerged as the way progressive businesses are introducing improvements. The reasoning is simple.

• Processes can be divided into component parts making the workload manageable
• Issues can be tackled in stages, minimising disruption
• ‘Tech spikes’ ensure API connections are possible and data being consumed is available in the format needed
• Processes can be isolated and tested before deployment, minimising failure
• The risk of choosing the wrong solution is reduced
• Confidence in the new provider grows with each component deployment
• Cost can be spread across multiple periods in line with budgets

The illustration below details some of the modular components in many Credit / AR processes:

Some of the improvements made possible to the new customer onboarding process are:-

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1 CRM integration and improving sales conversion

Credit information delivered into a CRM is of significant value to a sales team.  It helps focus effort on converting customers that would be approved for credit rather than wasting time on those unlikely to get an account.

2 Sales and Credit – Making friends with the old foe

Credit and Sales Team conflict is old news. It’s refreshing to encounter businesses where both understand each other’s challenges and work together to find a wise way forward to approve more accounts.  Problems tend to stem from a lack of communication and understanding of each other’s objectives.  Technology can improve relations by giving sales teams visibility over the progress of applications and understanding of the decision process to better understand why credit is declined.  

3 Digital applications

The customer experience should be an important aspect of onboarding. Speed and ease are paramount. Access Intell sees digital applications that are 12 stages long and Terms and Conditions of Trade that require microscopes to read them. Our advice is to keep it short and simple. If you can get information elsewhere, don’t ask the applicant. The customer should be able to apply in less than 2 minutes – 3 if there is a Director’s Guarantee – while standing in a field of crops or in a hair salon waiting for a colour to take.  If they can’t you might want to re-consider your solution.  

4 Identifying customers

Verifying customers are who they say they are is an important part of the onboarding process. We are seeing a rise in bigger and better biometric facial recognition and verification products with 3D, 4D and 5D solutions emerging. Businesses that operate Trade Counters may need this solution, but Access Intell is finding that a combination of ingenious methods are being deployed across businesses that are less invasive and more effective.  

5 E-signatures

Document signatures for the execution of Deeds of Guarantee (in the States that allow it) and the acceptance of Terms & Conditions of Trade are becoming the norm. E-sign technology has come a long way. Customers expect to be able to transact with suppliers digitally for ease and speed. If your business has not yet implemented a solution, and you trade in a sector that expects it, you may be creating an unfavourable customer impression.    

6 Assessing new accounts

Then we arrive at the point in the process when a decision is needed. Approval may be requested for:-

• new customers
  • processed via an online application
  • completing paper applications
  • an ABN delivered by a centralised unit overseas
  • via a sales person
  • an individual at a trade counter
• existing customers
  • seeking a limit increase
  • with changed circumstances including new owners or trade credit insurance withdrawal

Many of the same considerations are required irrespective of the situation. Traditionally, credit teams have relied on one credit bureau or source of information, but this can limit understanding of the opportunity or risk. Advancements in technological solutions now enable multiple sources of data to be aggregated and automatic selection of which source or combination of sources is most appropriate for the risk. This approach has been found to reduce cost by up to a third* and improve prediction accuracy by 48%*. Additionally, systemising the decisioning process (not so much in making the decision but being able to record it) allows businesses to maintain consistency and exert control over exposure risk.    

Stay tuned for Part 2, covering the second stage – PPSR Registrations.

* Source - Access Intell Data 2024