The accelerating move to electronic payments and ACH has created some curious implications for cash application teams. While on the surface it seems that electronic payments should be easier and faster to process than old-school paper checks, the new ways of providing the corresponding remittance, including via e-mail, have had a potentially negative impact. Instead of leveraging their bank relationships and old-school OCR systems, cash application teams have had to find new ways to process these remittances.
When it comes to achieving 100% automation of email remittance, one needs to consider two aspects. First, how to link email remittances to its payments? In the past, your bank would likely have done this for you. And second, how to extract remittance information from emails?
Cash application system vendors have deployed several different types of solutions to address the problem. One such solution is attempting to repurpose the OCR template-based solution. While this removes the IT bottleneck, it puts the burden of creating and managing templates to the business team. For every new remittance format, the cash application team will have to create a new template. The overall result is that manual effort is being shifted from applying cash to creating and managing templates, which does nothing but defeating the purpose of automation. You have now expanded Template Hell beyond paper checks and into the pristine area of electronic remittance.
The latest technologies are now making use of Artificial Intelligence and Machine Learning to automate e-mail remittance. The A.I. learns how to identify e-mails as containing remittance information by examining keywords and attachments. The system can identify and extract the data fields relevant to cash application. It can do this in situations where the remittance is provided in the body of the e-mail as well as when it is in an attached file. A.I.-based solutions have shown the ability to not only eliminate the need to navigate templates but also to achieve optimal automation rates.
E-mail remittance, like other electronic methods for providing remittance, presents a great opportunity to automate. Because errors due to scan quality and paper formatting are inherently avoided, automation rates are able to reach 100%. In fact, during implementations, some of the fastest automation is realized on customers who submit remittance via e-mail. This means that your cash application team would not need to spend any time on customers providing e-mail remittance, saving you a considerable amount of time and money.
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