What is an Invoice Payment?
Invoice payment refers to pay your bills to the suppliers and vendors for the services or products you purchase from them.
Business owners have to pay the invoices to their vendors and service providers for the goods and services to run their operations successfully. A business should pay its invoices within the due date to avoid any trouble in the future.
On-time payment keeps a good relationship between customer and supplier. You can use an online calendar and other tracking methods to track your due dates for payment. You can also pay your bills by setting up an automatic payment system.
You must try to make at least the minimum payment each month to avoid debt payments.
This article covers:
Tips For Making Invoice Payments On Time:
These tips will help you to complete the payment on time to earn credit scores that helps you to save money as well.
Review Invoices Once You Receive Them:
You should review the invoices right after receiving them. It keeps the information intact in your mind for some time and later helps you recall the total amount in case of emergency payment. It gives you the chance to check the billing details, services you buy, and the total amount you have to pay. You must check the following details of the invoice:
- Check the invoice due date to meet the deadline and make the payment on time.
- Review the list of goods and services to ensure that the items match your order, and if they are not, you can contact the suppliers to discuss the discrepancies.
- Check the total amount on the invoice and confirm it by matching it with your calculations.
Choose The Right Payment Method:
You should ask your suppliers which payment method they prefer and then follow that payment option to complete the payment. If they did not specify any certain method, you could choose it according to your convenience. You can check the offer for credit cards, and if they are giving away rewards and cash backs, it is the best choice to use the credit card for payment. Make sure to pay the dues of a credit card on time to avail the incentives.
Follow Payment Schedule To Organize Invoices:
To track the invoices, you receive daily or weekly; you can set a consistent accounts payable system. It helps you to arrange the invoices in a proper order to remind you of due payments. You can also use Excel to sort the invoices according to their due dates or use a cloud-based accounting solution to make an invoice payment schedule. If you receive a large number of invoices in a month, you should pay them every week to avoid the burden and confusion.
Setting reminders for your due invoices helps you to manage the payment on time without any trouble. You can set the reminders according to the due dates of invoices by using digital calendars. It decreases the chance of missing any invoice as you already have the record for all of them.
Automate Bill Payments:
It is the best way to automate your bill payments to avoid missing out on invoice payments. It helps you to set the invoices in order and pay them automatically through your credit card. You do not need to worry about your payments once you set the system for automatic bill payments.
Get Early Payment Discounts:
It is very common in business to offer rewards on early payment. You should make a list of the suppliers offering discounts or rewards on early payments. It helps you to set your reminders accordingly. You pay the bills within the due date of early payment to receive your discount. It helps you manage the invoices on time and saves your money, and earns rewards for you. Many businesses offer a two percent discount on the invoices paid within ten days of the invoice date regardless of the due date.
Set An Invoice Filing System:
The invoice filing system includes the complete details of:
- Paid invoices
- The total amount of payment
- Date of payment
- Method of payment confirmation
It gives you quick access to the invoices you need at the time of any emergency. It helps you to keep proof of your paid invoices along with the details.
How Do I Make An Invoice Payment?
Payment method is one of the important steps in the process of invoice payment. You should choose the method which better suits your business and profit. Here we are sharing few common methods of payment:
1.Make Payment By Check:
It is one of the cheapest and safest methods of paying invoices. But at the same time, it is a very lengthy process, as you need to fill the check, address an envelope and then send it to your suppliers. It takes a lot of time, especially when you have to clear the invoices frequently.
2.Payment By Cash:
Cash payment is the quickest payment method, but it is very unsafe, especially when you pay a large amount. Handling cash is a huge responsibility; even a minor mistake can lead to a big loss.
3.Online Payment Through Debit Or Credit:
Online payment is the simple and quickest way of payment. It saves your time and keeps your money secure. Using a reputable channel for online payment keeps your data safe and secure. You can make a payment any time of the day by using a debit or credit card.
4.Payment Through Mobile App:
It is the best way of making payments to your suppliers. You just need a mobile banking app that helps you to make online payments on the spot. It keeps your data safe, and you can easily track your transactions within few minutes. You can choose a debit or credit card for making payments through a mobile app.
5.Automatic Bill Payment:
It is the easiest payment method, where you set the due dates and total amount of invoices in advance. It automatically pays your bills according to the set schedule and notifies you. You should regularly check your account to make sure you have enough money to pay your bills on the go.
What Is a Bill Payment?
Banks offer the service of online bill payments, which is one of the easiest and quickest payment methods.
Here we will share few steps to set up an online bill payment:
- Collect the payable invoices and their account numbers.
- Enter the name of each payee and your account number into your bank’s online bill payment platform.
- Choose the date you like to process the payment.
- Decide whether it is a single payment or back-to-back payments for a particular payee.
- Track invoice due dates by setting reminders.