How to Automate Accounts Payable: A Step-by-Step Guide to AP Automation

The move to accounts payable (AP) automation has become a must for businesses looking to grow efficiently. It’s not just about speeding up invoice processing and payments — it’s about getting rid of manual tasks, improving financial accuracy, and giving your team more time to focus on other important work.

At Nimbello, we understand just how essential automation is to meeting the demands of today's AP teams.

Wondering how to automate your AP process? Let's explore what AP automation is, its benefits, and how to automate your accounts payable process today .

What is AP Automation?

AP automation is the use of technology to streamline the accounts payable process, from processing invoices and matching purchase orders (POs) to making payments and integrating with your ERP.

Instead of relying on people to manually enter data or approve payments, AP automation solutions do these repetitive tasks for you — cutting down on errors, speeding up processes, and giving you real-time insights into your finances.

Why AP Automation? 

Before we dive into how to automate AP, let’s look at why automation is critical.

Many companies still use manual methods for data entry, invoice matching, and payment approvals — tasks that take a lot of time and are prone to human error. Slow, manual processes can cause delays, missed payments, and even strain your vendor relationships.

But when you automate your AP, you can:

• Eliminate manual data entry: Automation captures invoice details faster and with greater accuracy than manual AP processes.
• Improve payment accuracy: Processing invoices and matching them to POs and receipts takes time — and a high attention to detail. Errors can lead to wrong, or even missed, payments. AP automation ensures data is quickly and correctly entered, so no payments slip through the cracks.
• Speed up payment approvals: Automated workflows automatically route invoices and payments to the right people at the right time.
• Enhance cash flow visibility: Real-time data helps you understand your cash flow, so you can make strategic, data-driven decisions.
• Strengthen vendor relationships: On-time (or early!) payments lead to happy suppliers. This not only increases trust and promotes stronger vendor relationships, it also may lead to cost-saving opportunities, like early payment discounts or better net terms.
• Cut unnecessary costs: Manual processes come with several unseen costs, from labor to supplies. AP automation reduces or eliminates these expenses, so you can allocate funds more strategically.
• Scale your business: An automated AP system can handle more invoices without needing more resources — meaning you can grow your business with ease.

How to Automate Accounts Payable

Automating AP reduces costs, simplifies audits, and gives you more financial control — making it easy to see why AP automation is a smart move for businesses of all sizes. But how can you get started?

Here are five steps to automating AP with ease:

Step 1: Evaluate Your Current AP Process

The first step is to assess your current workflow. Ask yourself things like:

• How do you receive invoices? Are they sent via paper or email?
• How are payments approved?
• Do you have a centralized system to track everything?

Evaluating your process and identifying where bottlenecks happen will show where automation can have the biggest impact.

Step 2: Choose the Right AP Automation Solution

Not all AP automation solutions are the same. The best accounts payable automation software will streamline operations and support future growth.

When choosing the right solution for you, consider features like:

• Invoice Capture: Look for tools that leverage Optical Character Recognition (OCR) or AI-based scanning to ensure data is captured accurately, no matter the format.
• PO Matching: Make sure the software can automatically match invoices with POs and receipts to save time and reduce human intervention.
• Customizable Workflows: Every business has unique approval processes. Look for a solution that allows for custom rules so invoices route where you need them to.
• ERP Integration: Your solution should be able to easily integrate with your Enterprise Resource Planning (ERP) system. This ensure smooth financial reporting.
• Reporting and Analytics: Access to real-time dashboards and analytics helps you manage your payables and optimize cash flow.

Step 3: Map Out Your Automation Plan

Once you’ve selected a solution, create a step-by-step plan for onboarding and training.

If you’re moving from a paper-based system, you may want to start with a phased approach. For example, begin with automating invoice capture and approval workflows, then move on to payment processing and reporting. This allows your team to adjust without feeling overwhelmed.

Step 4: Implement the Solution

Now comes the fun part — implementation. Work closely with your solution provider to ensure the system is set up to best fit your business processes. This includes configuring custom workflows and user permissions.

Once the system is live, make sure your team has all the resources they need to take full advantage of the system's features. Many AP automation providers offer ongoing training opportunities and support resources to set your AP team up for success.

Step 5: Monitor and Optimize

After implementation, it’s important to monitor your system’s performance.

Track how quickly invoices are processed and identify any challenges or bottlenecks that arise. Gather regular feedback from your team and identify areas for further optimization.

Nimbello: Your Trusted Partner in AP Automation

At Nimbello, we specialize in helping businesses transform their AP processes. Our automation solutions integrate seamlessly with your ERP systems and provide tailored workflows that meet your specific needs.

Whether you’re new to AP automation or want to optimize your existing system, our team is here to help. Contact us today to learn how Nimbello's AP automations solutions can transform your AP process.