In the financial services industry, member experience often takes center stage. Institutions highlight digital banking platforms, new loan products, or member rewards. But what often goes unseen is the foundation that makes those services possible: the back office.
Among back-office functions, accounts payable (AP) is one of the most critical—and one of the most overlooked. For credit unions, community banks, and other financial institutions, AP automation is not just about saving time. It’s about strengthening operations, improving compliance, and creating a smoother experience for the members who rely on you.
The Link Between Back Office Efficiency and Member Satisfaction
Front-line service is only as strong as the systems supporting it. When internal operations are efficient, member-facing teams have the bandwidth to focus on service instead of problem-solving.
For example:
- A vendor responsible for maintaining your branch ATMs gets paid late due to a bottleneck in AP. The vendor suspends service, leading to an outage that frustrates members.
- Or, manual invoice approvals take weeks to complete, leaving departments without supplies, slowing down service delivery.
These may seem like “back office” problems, but they have a direct, tangible impact on the member experience.
Research supports this link. According to AvidXchange clients, 92% say that our AP automation solutions save them time, and over 80% say that automation allows them to engage in more value-add work. Faster processing means vendors are paid on time, services remain uninterrupted, and staff have more time for strategic initiatives that benefit members.
Common AP Challenges in Financial Institutions
Financial institutions operate in a demanding environment. They must balance growth, regulatory compliance, and member expectations while often working with lean internal teams. AP is one area where inefficiencies show up quickly.
Key challenges include:
- Paper-heavy workflows: Paper invoices, manual data entry, and physical approvals are slow, error-prone, and costly. They also create unnecessary storage and retrieval issues.
- Audit complexity: Without digital records, audits become stressful and time-consuming. Teams must manually pull supporting documents, which can take days or weeks.
- Poor visibility: Manual processes often prevent CFOs and controllers from seeing accurate cash flow data in real time. This lack of insight makes it difficult to forecast or make informed financial decisions.
- Remote and hybrid challenges: As institutions adopt flexible work environments, paper-based or on-premise systems make it harder for teams to approve invoices or manage payments outside the office.
- Vendor management pain points: Vendor onboarding, compliance checks, and payments are harder to manage without automation—resulting in delays or inconsistent service.
These aren’t minor inconveniences. They can create friction across the entire institution, eroding the efficiency needed to support members effectively.
AP Automation: A Smarter Way to Support Compliance and Control
Compliance is one of the most pressing concerns in financial services. Manual AP processes often introduce risks that can undermine an institution’s ability to stay audit-ready.
AP automation provides built-in controls designed to protect financial institutions:
- Audit-ready records: Every invoice, approval, and payment is tracked digitally. Instead of scrambling to compile audit documentation, finance teams can pull a complete approval history in minutes.
- Fraud safeguards: Role-based permissions and approval workflows help prevent unauthorized activity, reducing the chance of errors or fraud slipping through unnoticed.
- Real-time visibility: Leadership gains instant access to financial data, allowing for stronger oversight and more proactive management of liabilities and cash flow.
- Consistency across locations: For multi-branch or regional institutions, automation ensures every branch follows the same financial process, reducing variability and improving compliance across the board.
These safeguards help keep you compliant as well as build confidence with members and regulators by demonstrating transparency.
Free Up Time to Focus on What Matters Most
Financial leaders are increasingly expected to contribute to strategic growth, not just manage transactions. Yet, when AP teams are bogged down with manual tasks, they can’t focus on higher-value initiatives.
By automating AP, financial institutions can:
- Reduce repetitive tasks: Automation eliminates the need for data entry, paper handling, and manual matching of invoices to purchase orders.
- Accelerate approvals: Digital workflows route invoices to the right approvers automatically, cutting processing times from weeks to days—or even hours.
- Improve staff morale: Teams can focus on analysis, planning, and vendor relationships instead of chasing signatures or searching for lost paperwork.
- Support better financial planning: With near real-time visibility into AP data, CFOs and controllers can make more accurate forecasts and strategic decisions.
The bottom line: Organizations can see improved employee productivity after adopting AP automation. For financial institutions, that productivity translates directly into more time and resources dedicated to serving members.
Tips for What to Look for in an AP Automation Solution
Not every AP automation platform is designed with financial services in mind. Institutions desire solutions that balance efficiency with compliance, scalability, and security.
When evaluating providers, look for a solution that offers:
- Seamless integration: Works with your existing finance and core systems without requiring an overhaul.
- AI-enhanced workflows: Adaptive automation that gets smarter over time, minimizing errors and improving speed.
- Robust compliance and security: Meets financial industry standards with encryption, access controls, and audit support.
- Digital approval routing: Helps ensure invoices are reviewed and approved quickly by the right stakeholders.
- Scalability: Supports growth as invoice volumes and vendor relationships expand.
- Dedicated human support: Access to experts who understand the unique needs of financial institutions and can help troubleshoot when needed.
The right AP automation provider should feel like an extension of your team, one that helps you modernize without creating disruption.
The Bottom Line: Member Services Start in the Back Office
Modernizing member services doesn’t just mean improving the front-end experience. It requires strengthening the systems that support every interaction.
When the back office operates seamlessly, your staff can spend less time on paperwork and more time delivering the exceptional service your members deserve. With an institution that runs smarter behind the scenes, your entire organization becomes stronger, more agile, and more member-focused.
Ready to bring modern efficiency to your AP process?
The information presented on this page is based on research and intended for educational purposes only. Anyone seeking to follow the information contained herein should consult their own advisors and conduct their own research prior to doing so. AvidXchange, Inc. and its affiliates disclaim any and all liability resulting from reliance on the information contained herein.