Save time and money when making supplier payments
Hands up if you want more efficiency in making supplier payments! Keep your hand up if you want someone else to be able to make payments on your behalf – but you don’t do it because that would mean giving control of your bank account to a third party.
If you still have your hand up, you need TransferWise.
This is a Xero integration that I’m excited about. I don’t hear many people raving about this tool – but I think that’s because they’ve overlooked how powerful it is.
Let me sum this up quickly. If you want:
- Full control of supplier payments,
- Support to make payments on time,
- An even more accurate balance in Xero for your company funds,
- And – and I’ve saved the best for last – LESS admin!
… you need TransferWise.
If you look at their website you’d be forgiven for thinking this is just for foreign currency transactions, but the Xero integration has opened up a huge opportunity to streamline your supplier payments.
Here’s how it works.
- Your accountant (or bookkeeper) processes your purchase invoices,
- You select the suppliers you want to pay and click ‘pay with TransferWise’,
- A total is generated, with a reference, which you pay to TransferWise,
- This single transaction is manually reconciled in Xero – regardless of how many suppliers are paid,
- Everything else is automatic – your suppliers are paid AND supplier transactions are reconciled in Xero.
Who will this benefit the most?
Benefits for all business owners
Controlling payments going out of your bank account is a must for all business owners. You need oversight, but you don’t have time to authorise and pay every supplier, every time. However, the risks associated with delegating this are considerable. TransferWise gives you control and allows you to get the support you need.
Benefits for businesses with a high volume of transactions
Every purchase invoice must be processed through your accounts. It’s not optional, you need a clear record of all transactions. This takes time. You can speed up the process with tools like Hubdoc, but the physical payment and reconciliation of that payment with your bank account needs to be done manually, or at least it has up until now.
If you’re processing 10–20 purchase invoices a month it’s not that arduous, maybe an hour’s work. Now multiply that by 10, 100, or even 1,000. That’s a full-time salaried person for six months.
Benefits for businesses that need control of cash flow
If this is you, it’s crucial you have an accurate view of your available cash; it allows you to plan and make good strategic decisions. Having an up-to-date balance in Xero will help you. The second you click ‘pay with TransferWise’ your bank balance in Xero is updated – that’s even more accurate than your bank account!
It’s not perfect
There is one drawback that I’ve found. And while there’s an easy solution, you might not like it.
I work with many business owners who still rely on their mobile banking app to tell them the state of their business. I disagree with this approach – it’s fraught with issues, inaccuracies, and inefficiency. But, for many it’s a reality.
If you want to know when you last paid a supplier your first instinct might be to check your bank transactions. However, if you use TransferWise you won’t see payments to individual suppliers in your bank account, just the one payment to TransferWise.
There’s an easy solution, of course: check the transactions for that supplier in Xero. If you’re not sure how, give me a call – you’ll be surprised at how easy it is.
Want to know more?
New systems and change in general can be hard. However, the rewards in this case are worth it. If you want to explore how you can save time and money with this app, book a free call with me now.