The consulting firm Genpact has developed a private blockchain solution that promises to improve cash flow management and reduce billing errors.
Like other blockchains, the new platform allows multiple parties to share data easily and transparently across their computer systems. When an invoice arrives in accounts receivable, for instance, it will be shared seamlessly with accounts payable and other departments.
No longer, then, should customer invoices fall through the cracks. By using smart contracts to execute payments, Genpact expects to reduce the number of past-due invoices to less than 3% in most companies, according to a news release.
In most industries, about 70% of invoice disputes arise as a result of inaccurate information and invoices that are late or go missing, the firm said.
Genpact's solution is designed to integrate with the banks that serve a company's customers and suppliers, allowing them to track the status of a transaction from beginning to end.
"Leading companies will be those that harness the power of digital technologies to transform processes, improve billing quality and timeliness and drive greater accuracy and visibility," Shantanu Ghosh, a senior vice president at Genpact, said in a news release.
Financial institutions have long hoped that blockchain technology would help them improve efficiency and slash back-office costs.
While the new system still requires human oversight, it should free back-office employees from many of the mundane tasks that currently eat up their time, a Genpact spokeswoman said.
Genpact developed the technology alongside one of its clients, a large company that has now deployed it to enhance its operations. The spokeswoman declined to name the client.
A number of the firm's other clients are experimenting with the platform, she said.
Genpact is already talking to clients about extending its blockchain solution beyond order-to-cash operations to supply chain management and other finance and accounting operations, the spokeswoman said.