Payment Cycle Management

Terminology

Learn payment cycle management terms as you explore electronic invoicing and payment concepts.

eAdoption

The implementation of invoicing best practices to drive adoption of electronic invoicing and payments to help you and your customers save time and money. Effective eAdoption programs involve plans that target specific customers along with clear communication programs, account managers for assisting the customer and reporting mechanisms for tracking eAdoption progress. Billtrust’s Managed eAdoption Program leverages our deep experience in this area.

ACH

The abbreviation for Automated Clearing House, which is an electronic network for financial transactions in the United States that is networked with others to exchange (clear and settle) electronic debit/credit transactions (i.e. no physical checks). ACH is an important part of allowing your customers to securely make online payments from their banks. Businesses are increasingly using ACH to collect from customers online, rather than accepting credit or debit cards. The process consists of (1) the customer authorizing the vendor to debit their account (usually resulting from a sign-up for an automatic debit of their account); (2) the vendor creating an ACH entry and transmitting the entry to the customer’s financial institution; (3) the ACH entry being sent to an ACH operator (most often the Federal Reserve); and (4) the transaction being sent on to the vendor’s financial institution for the vendor’s account to be credited accordingly. Billtrust’s Quantum solution supports this entire process.

AR Matching

Billtrust uses data from the ERP to validate information that was either captured from the remittance image or entered manually into the system.

Bad Address Report

A report available in your Client Connect portal that identifies incomplete or incorrectly formatted address information within a client’s mailing file so that returned mail can be prevented in current and future mailings.

Bullpenning

Bullpenning technology allows billers to delay the mailing of low-dollar invoices to reduce costs of postage and processing. By setting a minimum dollar threshold before an invoice will be sent billers can reduce their costs. Billtrust’s Quantum provides complete support for the bullpenning service.

Check 21 Act

The Check Clearing for the 21st Century Act allows the recipient of a paper check to create a digital image of the original check using a computer scanner or a mobile phone. Companies then use these images to deposit checks electronically, a process known as remote deposit.

CAR/LAR

Also known as Courtesy Amount Recognition/Legal Amount Recognition. Billtrust uses CAR/LAR (Courtesy Amount Recognition and Legal Amount Recognition) to recognize and interpret check data. This data can include but is not limited to the legal amount, the signature, and the payee.

Cash Letter

A group of checks packaged and sent by a bank to another bank, clearinghouse, or a Federal Reserve office. A cash letter is accompanied by a list containing the dollar amount of each check, the total amount of the checks, and the number of checks in the cash letter.

CASS

The Coding Accuracy Support System (CASS) is a certification program offered by the United States Postal Service for all companies providing mailing services, such as Billtrust, who would like the USPS to evaluate the quality of their address-matching software and improve the accuracy of their ZIP+4, carrier route, and five-digit coding accuracy. Billtrust utilizes CASS certified software which also allows us to obtain bulk mail discounts on your behalf from the USPS.

Cloud-Based

The process of providing remote services through the Internet from a single provider in a secure location to multiple users. Cloud-hosted solutions allow users to offer a service to their clients while holding their own provider responsible for the security of personal and financial information.

Commingling

The process of combining large quantities of mail into one stream to increase the number of pieces that qualify for the highest automation postage discount. Commingling increase the chances that mail has of achieving the maximum postage discount. The maximum postage discount requires mail-pieces to be a part of a grouping of 150 pieces or more being delivered to a single five-digit zip code.

Confidence Level

When information such as a remittance image and payment is matched with the open AR system, Quantum Cash Application calculates the degree to which they match. If the match is below the minimum defined by your organization, the information will be sent to one of the queues for an accounts receivable specialist to review.

Deduction Mapping

Billtrust’s Deduction Mapping functionality is designed to automate and streamline the processing of both valid and invalid deduction codes. These deductions require no human intervention and are automatically coded and posted correctly to the AR system.

Electronic Adapters

Using adapters, receivables transactions in almost any form, paper or electronic, natively connect to the Corporate A/R solution’s Business Server. As receivables transactions are received, the appropriate adapter is employed to process the information.

eMail Invoicing

Involves the transmission of all of a customer’s invoices via email. With Quantum Invoicing, we email your invoices to each customer in a single PDF file. The invoice is an exact replica of the paper invoice. Included with the email is our EasyImport feature that allows your customers to import their invoice data directly into accounting packages like QuickBooks.

EIPP

Electronic Invoice Presentment and Payment or EIPP refers to the fully automated business-to-business customer invoicing and payment process. With the Billtrust Quantum Payments solution, customers can receive their invoices electronically and sign on to a website customized with your look and feel or to a consolidator site to do everything they need to with regard to their invoices – they can: view the invoice; sort invoices by key criteria such as date, amount, location, PO#, etc.; search for invoices based on invoice or PO#; download the invoice data into their accounting package (e.g. QuickBooks); print the invoices; and of course, pay them.

Enterprise Resource Planning (ERP)

Systems that attempt to integrate several data sources and processes of an organization into a unified system. A typical ERP system uses multiple components of computer software and hardware to achieve the integration. A unified database stores data for the various system modules.

Fax Billing

Refers to the fax transmission of invoices to your customers. Billtrust Quantum Invoicing includes a fax solution with advanced automatic retry and recovery logic which ensures faxes will get through in a completed manner, and will include all invoices to be faxed that day for the customer.

Full-Time Equivalent

A way to measure a worker’s involvement in a project. An FTE of 1.0 means that the person is equivalent to a full-time worker, while an FTE of 0.5 signals that the worker is only half-time. Typically, different scales are used to calibrate this number, depending on the type of institution and scope of the report.

Invoice Acquisition

Refers to the method by which invoices are obtained by an invoice service provider, such as Billtrust. Billtrust receives billing feeds from our clients in a variety of different formats including CSV, TXT, EDI and XML.

Invoice Archive and Retrieval

Involves storing an electronic version of bills for access at a later date. Billtrust will store an image of all bills for customers, most of whom opt to store their bills for a two-year period. Billtrust provides you with ways to archive and retrieve your invoices to help you provide superior service to your customers, allowing your call center personnel to securely view, print, fax, and email any invoice in response to a customer inquiry.

Invoice Batching

Involves ensuring that different invoices with the same billing address get placed in the same envelope to save postage and envelope costs. Billtrust Quantum Invoicing ensures that invoice batching opportunities are leveraged for maximum savings.

Invoice Design and Generation

Refers to the layout and format of the invoices sent to customers and the related generation of these invoices. Billtrust designs a new invoicing format for our clients that improves the image of their company and makes it easier for their customers to understand their invoice. We have developed a proprietary form modeling and generation language that allows us significant flexibility in how to express the design of an invoice.

Invoice Marketing

Invoice Marketing is part of a direct marketing strategy which combines personalized marketing messages with must-read statements, invoices, receipts and other customer-facing documents. The invoice is a touch point that is reviewed by customers on a daily basis. Dynamic and personalized marketing messages can be imprinted on your invoices that allow you to drive new revenue with your customers by notifying them of additional products and services, special discounts and promotions, etc. Billtrust offers a user-friendly interface within their Client Connect portal that makes it easy for our customers to place personalized messages onto an invoice.

Invoicing BPO

Business Process Outsourcing for the invoicing function involves outsourcing the entire process of invoicing to an outsourced invoicing provider such as Billtrust. For paper invoicing, the entire process of invoice printing, folding, envelope stuffing and invoice faxing or invoice mailing is included; along with access to necessary on-line systems to view images of the invoices which have been sent. For electronic invoicing, the entire process of electronically transmitting the invoices to the customer, along with potential electronic payment receipt and settlement can be part of the process. Billtrust is a specialist in the business process of invoicing, and we support a broad range of alternative scenarios to meet every customer need.

Invoicing Optimization

Refers to optimizing the invoicing process. Invoicing process optimization involves maximizing invoice accuracy and minimizing the time and cost associated with all steps in the process: from the point at which the invoice is generated through to the point where payment is received from the customer. Billtrust has deep subject-matter expertise in invoicing process optimization, including effective invoice design which is an important part of the process, having helped hundreds of companies to optimize their billing to save our clients and their customers time and money.

Invoicing Strategy

It is important for any business sending a large number of invoices on a recurring basis to its customers to take a strategic approach to invoicing – meaning that they should consider how the invoicing process interfaces with other internal processes and their customers’ processes (or activities if it is a consumer), and define how their internal business objectives will be met regarding improving marketing effectiveness, improving customer service, improving efficiency through electronic initiatives, cutting costs, etc. Most often, when companies take a hard look at their invoicing function within the context of their overall strategic objectives, they conclude that using a payment cycle management specialist like Billtrust delivers the best return on investment.

Level 3 Credit Card Processing

Level 3 credit card transactions include an extensive amount of data, making them the most secure transactions of all. You’ll also save the most money when you choose to accept and process Level 3 transactions. Banks are not the ideal path for processing Level 3 credit card payments. This is because banks lack the technology required to collect and transmit the necessary level of detail to qualify the transactions with the card brands. Level 3 credit card payments are made with Purchasing Cards, not individual or standard credit cards. Procurement departments are being pushed to use purchasing cards because they are more secure and allow for advanced reporting.

Lockbox

In a traditional lockbox setting (at a service bureau or a bank), all of the documents contained in the physical envelope are scanned and tied together into an electronic transaction (also called an envelope). The lockbox creates an “image transmission” file that contains check information (including ABA, account, check number and amount) and pointers to the transaction images, such as check and remit. The lockbox can use FTP or a direct connection to send the image transmission file and the images to a server at your location.

Magnetic Ink Character Recognition (MICR)

Characters used to print or encode information on financial documents so they can be sorted and processed by high-speed magnetic or optical recognition equipment.

OCR

Also known as Optical Character Recognition. Billtrust uses OCR (Optical Character Recognition) technology to extract words and characters from the remittance documents and check that are used for processing.

Online Billing

Also called EBPP (Electronic Bill Presentment and Payment), this refers to business-to-consumer scenarios where bills are transmitted via e-mail and/or made available via a hosted website for review and potential payment by the consumer.

Paper Invoicing

Refers to all of the steps involved with designing the invoice, generating and printing the invoice, sorting, stuffing envelopes, sealing envelopes and mailing the invoice via the USPS. Quantum Invoicing supports the entire process. We maximize postage discounts due to high volume mailing, address certification and mail presort. We utilize state-of-the-art, highly automated printing, inserting and mailing equipment. We get the best pricing on materials due to high volume purchases of paper, envelopes and ink. We enable batching of your invoices to make sure all bills going to the same address are put into one envelope and bullpenning of low dollar invoices to reduce your costs by only sending invoices to your customers when a minimum dollar threshold is met. And we can offer a 100% invoice delivery guarantee thanks to our advanced dual bar coding and scanner technology. Finally, we are experts in invoice design and research shows that a well-designed invoice reduces customer service inquiries, drives greater customer satisfaction and faster payment.

PCI Compliance

The Payment Card Industry Data Security Standard (PCI DSS) is a set of requirements designed to ensure that ALL companies that process, store or transmit credit card information maintain a secure environment. The Payment Card Industry Security Standards Council (PCI SSC) was launched on September 7, 2006 to manage the ongoing evolution of the Payment Card Industry (PCI) security standards with focus on improving payment account security throughout the transaction process. The PCI DSS is administered and managed by the PCI SSC (www.pcisecuritystandards.org), an independent body that was created by the major payment card brands. Billtrust’s Quantum solution is PCI Level 1 Compliant.

Presorted Mail

A form of mail preparation required to bypass certain postal facilities within the delivery process to obtain postage discounts by grouping pieces together in sequenced ZIP Code or carrier routes.

Reduce Days Sales Outstanding

Days Sales Outstanding expresses the average time, in days, it takes your company to convert its accounts receivable into cash. DSO is important as a financial indicator to the extent that it shows the age, in terms of days, of an organization’s accounts receivable and the average time it takes to turn those receivables into cash. Optimizing the invoicing and payments process can reduce DSO by cutting the time it takes to get invoices to customers, and cutting the time it takes to elicit payment from customers.

Remittance

A payment; invoice, stub, coupon, or check.

Remittance Advice

Notification to the provider by the payer regarding the payment information for services delivered.

Remittance Data

Information accompanying payments and employed by users to update their accounts receivable.

Remote Deposit Capture (RDC)

Customers use check scanners to capture check images at their place of business. Then, instead of making a trip to the bank to deposit checks, customers send check images to the bank for deposit.

Return on Investment

The rate of profit or loss. ROI is usually given as a percent rather than decimal value. It does not indicate how long an investment is held. However, ROI is most often stated as an annual or annualized rate of return

SSAE16 Audited

Statement on Auditing Standards (SSAE16) is a widely recognized auditing standard developed by the American Institute of Certified Public Accountants (AICPA). A service auditor’s examination performed in accordance with SSAE16 is widely recognized. Certification represents that a service organization has been through an in-depth audit of their control objectives and control activities, which often include controls over information technology and related processes. Billtrust is SSAE16 certified.

Signature Capture

Refers to functionality where an image of the signature of the person who signed for receipt of a customer’s invoiced items is made available as part of an on-line system as supporting documentation for related invoices.

Statement Invoicing

Refers to the regular, recurring generation of invoices to be sent to customers.

Uncertified Addresses

Refer to addresses which cannot be verified using CASS certified software. This software is used to obtain barcodes from the USPS for addresses in order to speed USPS processing and obtain bulk mail discounts. Addresses typically fail verification and are thus uncertified for a variety of reasons including: incorrect secondary lines on the address; an incorrect order of the information in the address, etc.

USPS Intelligent Mail Barcode

Refers to the barcode retrieved by the CASS certified software to enable the USPS to scan the address enabling faster processing; reduced postage requirements; and advanced tracking or mail. Billtrust Quantum includes advanced tracking of intelligent mail allowing our clients to view where, exactly, their invoices are at various points in the USPS delivery process.

Wholesale Remittance

Business to business (B2B) customer account payments. Unlike retail remittance, B2B account payments are not standardized. Vendors receive and must process customer-generated documents.

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