How Can Robotic Process Automation Optimize Costs In AP?
Cost is always an important factor that businesses consider first when looking for solutions to improve business processes. In the context of strong digital transformation, Robotic Process Automation (RPA), such as AP process automation, is becoming the solution that businesses choose. How does AP automation optimize cost? Read the article below.
Automation market trends
The global market size for robotic process automation (RPA) is estimated to reach USD 3.79 billion in 2024. Furthermore, it is projected to grow at an impressive compound annual growth rate (CAGR) of 43.9% from 2025 to 2030. (Grand View Research)
In 2024, the large enterprise segment is expected to account for the largest share of market revenue. This growth is primarily driven by the many benefits RPA provides, allowing organizations to optimize operations, boost efficiency, and reduce costs.
At the same time, the small and medium-sized enterprise (SME) segment is projected to experience even higher growth, with a compound annual growth rate (CAGR) of 46.0% during the forecast period. The rising adoption of automation among SMEs is a significant factor in this expansion, as businesses turn to RPA solutions to streamline their processes, enhance productivity, and sharpen their competitive edge.
These trends emphasize how automation has become a critical factor in enabling businesses—whether large, medium, or small—to optimize costs and achieve long-term growth. One of the most prominent areas where automation is having a notable impact is in Accounts Payable (AP) processes.
But how exactly does AP automation through RPA help businesses optimize costs? Let’s delve deeper into this topic.
How AP automation using RPA helps reduce costs
AP automation: Impact on payment costs
In a survey of AP automation users and solution providers, it was found that small and medium-sized businesses (SMBs) currently spend between $16 and $22 to process a single invoice using manual methods. However, with the adoption of AP automation solutions, this cost drops significantly to just $6 to $7 per invoice. This translates to an impressive cost reduction of 60-70% compared to traditional processing methods.
For large enterprises, Goldman Sachs estimates that the cost of manually processing an invoice is approximately $9. After implementing automation, this cost decreases to just $4 per invoice, resulting in a 55% savings.
These figures not only highlight the substantial cost savings achieved through AP automation but also underscore its impact on operational efficiency. By transitioning from manual to automated processes, businesses can eliminate time-consuming tasks such as data entry, invoice matching, and payment approvals. Additionally, automation minimizes human errors, further enhancing accuracy and overall workflow efficiency. This shift not only reduces financial strain but also frees up valuable employee time, allowing teams to focus on higher-value activities that drive business growth.
Payment method structure and improvement through automation
AP automation helps optimize costs by transitioning from traditional payment methods to electronic payments. For small and medium-sized businesses (SMBs), conventional payment processes often involve a heavy reliance on paper checks, which constitute a large part of their B2B transactions. However, with the implementation of AP automation, the dependency on paper checks is reduced, and the adoption of Automated Clearing House (ACH) payments and virtual cards increases, further optimizing costs.
Currently, large enterprises typically use Enterprise Resource Planning (ERP) software to manage financial operations, including two-way and three-way matching for invoice verification. However, many ERP systems lack seamless integration with electronic payment solutions. As a result, nearly 50% of invoices in these organizations are still settled via paper checks, leading to inefficiencies and unnecessary costs.
By optimizing payment methods through automation, businesses can optimize cost and achieve significant savings in both direct and indirect expenses. These savings include reduced printing costs, lower postal and transaction fees, and the ability to take advantage of early payment discounts. This shift proves especially advantageous for companies aiming to maintain steady cash flow while improving overall financial efficiency.
Human resource impact
According to a survey by Hyland Software, employees in the Accounts Payable (AP) department typically spend about 30% of their time on data-related tasks, such as processing purchase orders and invoices, answering supplier and staff inquiries, and correcting data entry mistakes. They also spend time seeking management approvals, which further complicates their workload. While these tasks may not be inherently difficult, they are often complex and time-consuming, significantly increasing operational costs for businesses. By automating these processes, companies can optimize cost, reducing the time spent on manual tasks and improving overall efficiency.
One of the most critical factors to consider when evaluating the benefits of AP automation is workforce efficiency. In a traditional AP department, roles typically include data entry clerks, analysts, supervisors, and managers. However, with the implementation of automation, businesses can eliminate the need for manual data entry roles, reducing the burden of repetitive, labor-intensive tasks.
By leveraging automation, companies not only achieve significant cost savings in labor expenses but also streamline their AP operations for greater efficiency. Moreover, eliminating manual tasks creates an opportunity for businesses to reallocate human resources toward more strategic functions, such as financial data analysis. This shift not only enhances long-term growth potential but also contributes to improved business performance and revenue outcomes.
Conclusion: AP Automation - A Huge Cost Saving Opportunity
According to Business Dasher, most businesses (97%) agree that business process automation is important for digital transformation. 67% of businesses use business process automation solutions to improve comprehensive visibility across multiple systems. Up to now, there is no need to prove too much about the benefits of automation.
There are many companies providing outsourcing automation solutions, making it easy for businesses to access and apply these solutions to their operating processes. AFusion is one of them, offering automation solutions, especially AP process automation. AFusion’s solutions are specifically designed to fit your business’s operating processes without changing the way you operate or requiring time to adjust. By implementing these solutions, businesses can optimize cost, streamline operations, and enhance efficiency without disrupting their current workflows.
Technology is the key to maintaining a competitive position. You will be surprised by the outstanding benefits when applying modern technology solutions. Contact us to find out how AP automation can help your business reduce costs? And how much can you optimize costs? Contact us.
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