Processing cash is both time-consuming and fraught with fraud risks. While many companies are seeing their cash collection cycles increase, they are also faced with a lack of visibility into their total cash position. All too frequently, payment decisions are made without the necessary insights needed to optimize disbursement strategies with suppliers.
Perhaps most importantly, inefficiencies around cash processing often result in lost opportunities to put vital working capital to work. Fortunately, the latest cash processing solutions take an end-to-end approach to simplifying the receivables process.
With the right solution in place, companies can achieve more efficient store management while delivering provisional credit for deposits, improving cash flow and allowing treasury to access critical working capital more quickly.
Smart Business spoke with Douglas V. Wyatt, executive vice president, senior commercial banker at Fifth Third Bank, about improving cash processing.
What common errors can occur when manually processing cash?
For many businesses, processing cash payments manually is risky, prone to processing errors, labor intensive, costly in terms of time and productivity, and ties-up vital funds awaiting deposit. Businesses requiring daily deposits of cash receipts may expose employees to an elevated level of risk from theft during trips to the bank. Manual cash handling in store locations also raises the risk of theft by employees, which negatively impacts critical margins.
In addition, the time required to process cash and currency takes key personnel away from customer-facing duties, diminishing the customer experience.
Is there a better way to process cash?
One way treasury professionals can solve these cash collection issues is through a currency processing solution. Smart safe technology installed at store locations, for instance, allows employees to feed currency into the device’s note reader throughout the day. The note reader verifies the currency and automatically tracks the deposit by employee and day totals. Deposit information is automatically relayed to the bank where the organization’s account is then credited for deposit the next day.
Such a currency processing solution virtually eliminates errors and reduces the risk of theft. Because receipts are regularly collected from the device by an armored courier service, employee safety is also improved. By adding an automated cash processing solution, personnel are freed from labor-intensive deposit preparations, allowing them to focus on customer service.
How does technology increase efficiency?
Cutting-edge currency processing can transform cash collection processing, enabling treasury to achieve significant operational efficiency. Smart safe technology can speed up handling of cash and currency while automatically scanning for counterfeit bills and logging each entry. This innovative solution can help reduce both internal and external cash losses, at the same time enhancing the safety of personnel by reducing the amount of cash handling.
Overall, this solution increases employee productivity, enhances operational efficiency, lowers costs and improves margins. Further, an effective currency processing solution can enable treasury to free up idle working capital, allowing the business to better meet its strategic goals.
How might a more efficient cash handling system benefit a business?
Treasury professionals should look to improve cash handling using an end-to-end methodology. By coordinating all components of cash handling, treasury can take advantage of a currency processing solution that simplifies the receivables process.
As the cost of manual processing rises, proven, cost-effective technology solutions are becoming far more attractive. Finding the right solution starts with selecting a banking partner that truly understands your business. The provider you choose should offer solutions that are highly flexible, enabling you to meet your unique business objectives. Lastly, your provider should have the ability to design a proof of concept that ensures your targeted savings and return on investment are achieved.
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