Here are some of the advantages of EDI payments.
Better Business Relationship with Your Trading Partners
EDI payments can help your business verify payment request data quickly, fast-tracking the invoice payment process.
A manual data entry process that relies on your AP department to receive PDF vendor invoices, for instance, can significantly derail payment processing. Besides delaying payment-related processes, documents can get lost or damaged in transit.
Further, your B2B trading partners can benefit from EDI payment as it enables them to maintain a standard format for vendor payment data and streamline uploading documents to their ERP systems.
Improved Data Security
EDI is anchored on the ANSI x12 standard, which uses Value Added Network (VAN) transmission. The best part? You can control EDI because it’s a closed network.
You can, for instance, create an EDI network between your business and other organizations, leaving out everyone else. That way, you can control your network, ensuring you only transmit payment data to the right partners.
EDI is more secure than ACH and EFT.
Faster Processing Times
EDI networks run on the internet for payment order or remittance information transmissions between trading parties. Because communication happens almost in real-time, EDI results in a streamlined accounting process.
ACH processes, for example, require banks to transmit and process information in batches. If you miss the batch deadline, you must wait for the next business day for your payment requests to be processed.
With EDI, however, trading parties can create a business-to-business relationship, so there’s no need for batch processing. EDI transactions are clear in real time, fast-tracking processing times.
Cost-effective Payments at Scale
You can create a direct deposit or web EDI payment network to simplify your electronic payments.
In addition, you can automate the payment operations within your EDI network, eliminating the expensive and ineffective manual process.
For example, you can match documents and transfer payments to verify your vendor’s request, streamlining your transaction.
Further, your business can receive payment owed quickly, cutting down cash application times and establishing a predictable cash flow without bending your budget.
EDI payments eliminate the time-consuming, ineffective manual payment process. It ensures that your accounting staff doesn’t waste time identifying errors in your cash flow or manually matching documents and mailing them.