Bank of America is helping its corporate customers forecast how much cash they have coming in and when payments will hit. It will provide clients a week-by-week prediction of incoming receivables based on the historical payment patterns of the client's customers. Rather than relying on an invoice due date to forecast cash flow, the system looks at how early or late customers typically pay invoices.
The new feature is part of the bank's Intelligent Receivables product, which uses artificial intelligence to organize business clients' incoming payment information and associated remittance details from various payment channels and sources and match them to open invoices.
The bank also announced it is adding a new suite of reports to show clients trends on their customers' behaviors, such as identifying customers who consistently pay late or have the highest outstanding balance of open invoices. The roughly 20 additional report types and receivables forecasting are all additions to the base product rather than purchased add-ons.
According to Liba Saiovici, head of global receivables in Global Transaction Services at Bank of America, the additional features are designed to help drive credit-related decisions and provide detail to collections teams so they can target the most problematic customers, and use their time in a way that will most efficiently reduce outstanding balances.
"The new capabilities are a natural extension of a tool that constantly interacts with data," Saiovici said. "The new dashboards give clients a more comprehensive view into their total collections and outstanding receivables from which they can dig further to better understand their customer's behavior around timeliness and preferred modes of payment."
Some other banks for corporate customers provide accounts receivable tools akin to Bank of America's, including JPMorgan Chase's
Other corporate banks also offer AI-based tools in their accounting products, including
"We had one client who discovered they had nearly half of their customers taking unearned prompt-pay discounts, costing their company almost $2 million a year," Melvin said. The problem, he said, was the company's accounts receivables clerks focusing exclusively on manually matching payments to their corresponding remittance information. "Their job was to key data – not to red flag when a customer was 20 days late and taking a 2% discount."
Launch Credit Union claims it reduced fraud by 97% after adopting a real-time solution in 2020.
Bank of America looks to differentiate its product by offering insights other products cannot, according to Saiovici. The product is part of Bank of America's CashPro app, which is its online banking platform for business clients.
"We're giving clients not just an accounts receivable automation tool but intelligence from which they can better manage their back office and have better visibility into their receivables," Saiovici said.
