For every business, revenue growth brings the challenge of managing accounts receivables. However, the way receivables are managed can significantly impact a company's liquidity and financial health.

In today's fast-paced, digitally-driven business landscape, an efficient accounts receivable (AR) automation solution isn't a luxury—it's a necessity. For software providers offering Accounts Receivable services, delivering a top-tier AR automation solution is the key to attracting and retaining business customers. This blog explores the essential components of a winning AR automation product, emphasizing the role of accounting integrations like RootFi’s Unified Accounting API.

Related: 5 Accounting Automation Solutions You Can Build Using RootFi’s Unified API

What is an Automated Accounts Receivable (AR) Solution?

Modern accounts receivable automation involves optimizing the process of invoicing, tracking, collecting and reconciling payments using an intuitive and user-friendly application.

Benefits of an Automated Accounts Receivable (AR) Solution

The perks of an AR automation solution are plentiful for both employees and businesses. Here's a quick rundown:

Employee benefits from an Automated (AR) Solution:

  • Minimized manual work and data entry
  • Simplified invoice generation and follow-up process
  • Reduced risk of errors and discrepancies
  • Enhanced job satisfaction and productivity

Business benefits from an Automated (AR) Solution:

  • Accelerated cash flow and reduced days sales outstanding (DSO)
  • Lowered risk of errors, delays, and bad debts
  • Saved time and resources from manual follow-ups and reconciliations
  • Real-time visibility of receivables for better financial forecasting and decision-making

For small businesses struggling to stay cash flow positive, automating accounts receivable could be the key factor in their survival. One study found that 82% of businesses that fail in the U.S. do so because of cash flow problems — not due to a lack of profitability or good service.

Incorporating accounting integrations for reconciliation further enhances these benefits. By aligning received payments with a business's established accounting practices and recognizing revenue accurately, businesses can save significant time and improve the precision of their bookkeeping.

Furthermore, offering reconciliation using accounting integrations also positions you, the provider, as an indispensable partner for businesses. The ability to close books faster and with greater accuracy is a priority for many companies, making your solution an attractive proposition.

What is the Automated Accounts Receivable (AR) Workflow?

An automated Accounts Receivable (AR) workflow typically follows these steps:

  1. Invoice Generation
    An automated system generates an invoice immediately after a sale or service is rendered.
  2. Payment Tracking
    The system tracks payments due and sends timely reminders to customers.
  3. Payment Collection
    Payments received via various channels are automatically logged in the AR product.
  4. Reconciliation
    The payments are then reconciled against the outstanding invoices, and the data is synced with the relevant accounts in the business’s accounting software.

Most AR products streamline the first three steps but fail to offer reconciliation due to a lack of integrations with the accounting platforms. The reconciliation step is often a manual and cumbersome process. By leveraging accounting integrations, AR automation solutions can seamlessly sync payment data with accounting platforms, transforming a potentially error-prone task into a streamlined process.

Why Accounts Receivable (AR) Solutions Need Accounting Integrations

Manual Accounts Receivable (AR) processes are riddled with challenges: late payments, lost invoices, and cash flow bottlenecks. For small businesses with limited cash flow, a few late payments could mean shutting down. Without automation, businesses lack real-time insights into their financial health, making informed decision-making difficult.

The true potential of an Accounts Receivable (AR) product is unlocked when combined with accounting integrations. Manual reconciliation becomes a thing of the past, boosting productivity and ensuring financial data accuracy.

As businesses increasingly embrace digital solutions, the demand for effective AR automation grows. The global AR automation market, valued at $3.3 billion in 2020, is projected to reach $6.5 billion by 2027 (Source).

In this competitive landscape, providers like, Growfin, and Billtrust are continually enhancing their offerings. Many have integrated with accounting platforms directly or through Unified API providers like RootFi.

The Role of Unified APIs in Accounting Automation and Modern Accounts Receivable (AR) Management

Given that seamless integration with accounting systems is a highly sought-after feature, your integration strategy is crucial. While options like embedded iPaaS solutions and in-house development exist, a Unified API often emerges as the most efficient solution. Embedded iPaaS solutions are better suited for one-to-one integrations. Building integrations in-house requires significant time, money and developer resources that would be better suited to building your core product.

By using RootFi’s Unified Accounting API, you can:

  • Significantly cut down development costs
  • Reduce your Time-to-Market from months to weeks
  • Offload maintenance and focus on core product innovation
  • Access normalized data, and learn one API, not many
  • Scale effortlessly with additional integrations


Build vs Buy: The Ultimate Guide to B2B API Integrations

Five Challenges with Unified APIs and How RootFi Solves Them

How to Build an Automated Accounts Receivable (AR) Solution with RootFi’s Unified Accounting API:

Building an automated AR solution with accounting integrations is straightforward with RootFi. Here’s how:

  • Sign up for RootFi.
  • Connect up to five customer’s accounting platforms for free to test our platform.
  • Integrate your user interface with RootFi’s API endpoints using our Docs.
  • Onboard all your business customers via our Connect Link for a seamless experience.

By leveraging RootFi’s Unified Accounting API, your AR solution can offer features like automated invoicing, real-time payment tracking, receipt scanning, and most importantly, automated reconciliation.

Key Features of an Effective Automated Accounts Receivable (AR) Product with RootFi

An outstanding AR automation solution should offer:

  1. User-Friendly InterfaceEnsure a seamless user experience for both web and mobile applications.
  2. Automated Invoicing and Follow-upsLeverage RootFi’s API for streamlined invoice generation and payment reminders.
  3. Multi-Currency and Global SupportAccommodate international transactions and tax rates effortlessly.
  4. Real-time ReportingProvide comprehensive dashboards for instant financial insights, only possible via accounting integrations.
  5. Robust Security MeasuresProtect financial and customer data with top-notch security protocols.
  6. Automated ReconciliationOffer an end-to-end solution that automatically tracks and reconciles payments in the customer’s relevant accounts.

Learn how to use RootFi’s Unified Accounting API in your Accounts Receivable (AR) Product

In the quest for optimized business operations, an automated accounts receivable solution is no longer optional—it’s a strategic necessity. By incorporating accounting integrations via RootFi’s Unified API, you can propel your AR automation solution to the forefront of innovation, and provide your business customers with the tools they need for financial agility and success.

Elevate your financial service offerings with RootFi’s Unified Accounting API and build an AR automation solution that sets the standard for efficiency, accuracy, and convenience. Get started with the RootFi platform for free. Alternatively, book a personalised demo with our team.

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