Integrating payments into your accounting software is essential for real digital transformation - here’s why
Last editedMar 20265 min read
Save time, money and stress for you and your customers by integrating your accounting and payments software - the future of merchant services
When we talk about ‘digital transformation’ on the financial side of business, having dedicated accounting software up and running is half the battle won. That’s the manual legwork of your reporting, reconciliation and ledgers sorted - but there’s still a rather gaping, often error-prone space left between your payments being invoiced and them being collected and accurately recorded on your books.
A built-in bank payments solution fills that final, manual gap in your process. It’ll help you better manage your cash flow with reliable, on-time payments, further reduce your admin time (quite considerably, in fact), and support your business’s growth as you scale up to high-volume enterprise payments.
That’s exactly what we offer. And the good news is we work with over 350 software packages already, so integrating GoCardless with the tools you already use is easy.
Get paid on time, reduce debtor days and become a master of your cash flow
Keeping your business in good health is all about getting paid on time. The more you can reduce the gap between making a sale and actually seeing the funds arrive in your account (aka reducing your debtor days or Days Sales Outstanding), the better.
In a traditional setup, you’re often at the mercy of your customer’s schedule, leaving your cash flow vulnerable while you wait for invoices to be paid. But if you’ve got integrated bank payments on your side, you’ve got a proactive tool working to ensure you can get paid quickly, make light work of forecasting, and steer clear of failed payments (and, in turn, bad debt). Then there’s the introduction of ‘zero-touch’ reconciliation, which can drastically reduce your admin time.
Here’s a quick fire on how all that works.
Get paid faster, without the chase
Integrated bank payments allow you to pull payments automatically from your customers on the due date provided by your accounting software.
If, for whatever reason, a payment fails, you’ll benefit from the system automatically retrying for you. We, for example, have our automated payment recovery tool, Success+, which uses machine learning to figure out when your customer is most likely to have sufficient funds in their account, and retry payment then.
Customers, occasionally, might not have the funds in the bank account. Success+ has helped us guarantee those collections, even if they are a bit delayed. It gives customers confidence that they're dealing with a business that knows what it's doing, too.”
Automation makes cash flow forecasting easy
Automated payments are authorised ahead of time via a mandate. A mandate is essentially a digital permission slip that allows you to collect money directly from a customer's bank account (there’s a good chance you’ll already be familiar with paying your bills like this via Direct Debit). Your customer agrees to this when they sign up by filling out a mandate form, and from that point on, payments due are collected without any further requirement from either side.
With mandated payments in play, forecasting becomes much less guesswork and much more predictable, giving you a much better handle on your cash position going forward.
A quick cash flow forecast example: manual vs integrated
Manual forecasting: You have £10,000 in invoices due at the end of the month. Based on the historical data you’ve got, you estimate that 70% will pay on time, 20% will pay a week or more late, and 10% will require chasing for payment. This is a conservative ‘best guess’, based on an error margin (another thing you estimated) of around 20-30%.
Automated forecasting: You have £10,000 in invoices due at the end of the month. Because you have mandated payments active - and based on reliable data from prior months - you know that approximately 97.3% of these payments will go through successfully and on time (merchant services powered by GoCardless typically enjoy a payment success rate of 97-99.5%). This enables you to allocate funds towards your core operations confidently, safe in the knowledge the cash will be there.
Stop bad debt before it starts
Bad debt, meaning money that’s owed to you but is unlikely to be paid (and consequently written off), often starts with failed payments.
Card payment failure rates currently sit at around 10-15%. If you switch to bank-to-bank payments, which bypass card payments entirely, failure rates reduce to 0.5-2.9%. And if a bank payment fails, you have automatic retries working in the background to minimise lost revenue.
Automated bank payments are therefore the much better bet for protecting your revenue at source.
Slash your admin with ‘zero-touch’ reconciliation
As an added bonus to all of the above, digitalising the invoice-collection-recording process removes the remaining manual reconciliation responsibility on your accounts. Integration allows payment data to flow freely between your payment and accounting software, auto-matching payments to invoices and saving hours of manual reconciliation.
Enjoy all the benefits of Direct Debit but without all the hassle & expense of dealing with banks.
GoCardless does all the heavy lifting for you so you can collect payments on time every time with just a few clicks!
Scaling up? Enterprise payments are no problem
Complete digital transformation is especially important if you’ve got ambitions to grow, because without the right solution in place, your payment admin scales with your business’s growth. Once you’re processing a high volume of payments each month, any manual admin processes you have remaining in your system will be exposed quickly by the complexity of the compliance, data management and reconciliation demands.
So, best to do something about it ahead of time. Our integrated bank payment solutions are built to scale securely for enterprise payments and international expansion.
Handle high-volume enterprise payments with confidence
Large-batch card payments come with all sorts of potential hurdles. Payments can fail due to cards being lost or stolen, you can hit processing limits - or accidentally trigger fraud algorithms that panic in the face of high-volume requests. All of the above can result in mass payment failures.
Bank payments, meanwhile, are built for the digital age of high volume. Because the system relies on pre-authorised mandates rather than reams of card data, large-batch bank payments come with verified permission. Plus, you cut out card intermediaries and the associated high fees that come with them.
This means you avoid the risk of any misguided failsafes derailing your collections, offering you the same confidence in payment success that you enjoyed at a smaller scale - and you save on processing fees, too.
Go global with ready-made international payments
Expanding into new territories unassisted can cause a few headaches. You have to set up new business entities, open foreign bank accounts and navigate the local payment regulations of your new location (like SEPA in Europe or ACH in the US - the equivalent of Bacs in the UK).
A singular integrated payment solution removes these borders. Right now, we’re set up in over 30 countries (and counting). That means you can collect payments from any of these territories with the local payment regulations, compliance and currency exchange covered by us. You can enter new markets instantly with no physical presence required.
Get built-in security with advanced payment fraud solutions
Bank payments replace potentially vulnerable card data with verified connections to bank accounts. Additionally, we offer payment fraud solutions like our end-to-end fraud protection, Protect+ and payer verification tool, Verified Mandates. Both of these features work automatically to optimise your customer experience and save you time, stress and money.
Integrated payment FAQs
How does integrating payments into my accounting software work? Is it difficult to set up?
Not at all. Payment integrations are very much designed to be plug-and-play. Most cloud accounting platform integrations won’t require a developer or IT expert. In most cases, it’s similar to downloading an app on your phone. The system will map to your accounts automatically - all you need to do is connect GoCardless within your software. The process typically takes minutes to complete.
Will it work with my current accounting software?
We have pre-built integrations with over 350 partners, including all the major players like Xero, QuickBooks, Sage and NetSuite.
What will the integration and introduction of automated payments look like for my customers?
The biggest change, as far as your customers are concerned, will be signing up to the mandate system. For existing customers, you’ll be able to send out bulk requests to switch to the new payment method, which will mean their payments are verified and automated until they decide otherwise. For new customers, the mandate form will just be part of your onboarding process. It’s seamless and professional - you’ll be replacing the manual payment of individual invoices with automated payments, so it’s a win for everyone.
Is it difficult to switch customers over?
No. We’ll provide you with email templates and bulk-invite tools to get your customers switched over. As it’s a quality-of-life improvement for your customers, too, you’ll find they generally welcome the switch.
What if I don’t use accounting software yet?
You can still use GoCardless via our dashboard or a custom application programming interface (API). This will give you all the benefits that come with bank payments, but you won’t have the automated admin benefits of accounting software. If you decide to start running accounting software down the line, you can still integrate GoCardless with it then.
