‘Check is in the Mail:’ How to Improve Business Cash Flow Through Automation

Many consumers and businesses alike have heard the old saying, “the check is in the mail.”

And yes, sometimes it’s true the check is in the mail, so you find yourself waiting. But sometimes the check never finds its destination due to an ever increasing trend of mail theft.

According to the Association of Finance Professionals’ (AFP) 2024 Payments Fraud and Control Survey, 80% of organizations were targets of either an actual or attempted payments fraud attack in 2023. New scams are being developed regularly, oftentimes beginning with stolen checks that are placed in the outgoing mail.

Now more than ever, it’s imperative that business owners and decision makers take proactive steps to protect their money and find the best payment methods to get the money quickly and safely in the bank.

Deciding where to start can be daunting, but here are a few tips to consider implementing to protect your business and improve its cash flow.

Automation is Key

Stop using checks wherever possible. Check issuance involves many manual processes and payment fraud continues to grow with this method of payment. There are measures you can take to help protect your company and improve your cash flow, including:

• Invoice Right Away: The sooner you get an invoice out after your products or services are sold, the sooner you should or could get paid, emphasizing the importance of timely invoicing to keep cash flowing.
• Go Digital: Don’t wait for checks. Instead, request deposits electronically from your customers when taking orders if possible. Offer discounts when taking orders to encourage early payment.  Customers often welcome the reliability of a known payment date as well as the speed of transfer that comes with electronic payment methods.
• Accept Cards & ACH Payments: Credit card and Automated Clearing House (ACH) payments are faster and settlement dates are very dependable, allowing you to streamline your receivables.
• Leverage Positive Pay: Limiting check usage is important, but not always possible. When you do need to use checks, utilizing Check Positive Pay services can help prevent fraud. With Check Positive Pay, you share with your bank details about the checks issued before the checks are presented to the bank and any unmatched items are flagged for your review and decision.
• Utilize Alerts: Implementing alerts for your accounts can help you streamline and manage your payables, receivables and much more. You can also set up alerts like incoming and outgoing wire alerts to help monitor and protect your accounts in real time.
• Consider Smart Safes: If you have large cash deposits, implementing Smart Safe technology can help ensure cash deposits get in the bank quickly while reducing reliance on armored cars or trips to the bank.

Monitor Your Credit and Cash Flow

Once you’ve implemented the right banking technologies for your business, it’s important to utilize online banking tools to monitor your day-to-day functions and your cash flow.

Online banking and daily bank reconciliation gives you a real-time view of your bank accounts and can help identify money matters that need your attention.

It’s important to know how much money your business is not only making but also spending. By monitoring your credit and cash flow each day, you will more easily be able to spot fraudulent activity.

Select the Right Banking Partner

While banking technology and monitoring of your credit and cash flow are great preventative measures, one often overlooked but imperative step is ensuring you also have a great relationship with your banker.

Your banking partner can be one of your best assets when trying to protect your business and your best resource when time is of the essence with your money. By understanding the specifics of your business, your bank and your banker can aid when speed and availability of cash is important.

If you suspect fraudulent activity or that your business’ assets are at risk, contact your banking partner immediately to review your accounts and make changes to your preventative efforts as needed to minimize the damage and prevent future fraudulent attacks.

While protecting a business’ assets starts with the business owner or decision maker, it goes beyond that – a comprehensive plan to protect your business includes employees and banking partners as well. It’s critical to first create a plan to protect your business and then work together with your employees and partners to implement it.

If you’re interested in implementing some of these tips, or still not sure where to start when it comes to cash flow or fraud prevention, consider speaking with your local banker.