Markets

American Express Unveils Automated Accounts Payable Solution

American Express Co. AXP launched its proprietary automated accounts payable (AP) solution, American Express One AP.

This automated AP enables U.S. businesses to process supplier payments more easily and efficiently. The solution, built on the technology acquired as part of American Express’ buyout of a company in 2019, offers complete end-to-end payment processing that supports multiple payment methods including virtual Card payments, check and ACH (Automated Clearing House). The service is designed to work seamlessly with businesses’ existing accounting systems.

The global AP automation market size is expected to see a CAGR of 11% from $1.9 billion to $3.1 billion during the 2019-2024 the forecast period, per Research and Markets.

Demand for automated AP solutions is driven by the dire need for securing payment processes via digitalization and making the same an essential component of customers’ business. Automating the accounts payable process with innovative, end-to-end solution enables businesses to pay easily for what they need to ease operations and ultimately fuel growth.

Automated AP is one of the ways to cater to the digital payment requirement of businesses, which is different from card offerings and business-to-business partnerships.

Per Research and Markets, manual procedures for AP processes are expensive, error-prone and highly inefficient. The AP solution automates payment processes and enables enterprises to maintain a smooth vendor-supplier relationship. The AP automation solution offers visibility to the entire AP process, right from invoicing to receipt generation, ensuring proper approval, correct allocation, and timely payment and spend management. This, in turn, ensures clarity and transparency of the whole system.

The AP automation solution provides 24X7 accessibility and real-time view of the invoice status and on-demand reporting capabilities. These functionalities allow businesses to make informed decisions, backed by data insights, which will boost growth in the process.

Also, the current social-distancing conditions created by COVID-19, led to a need-based demand for digital payments, and automated AP fits the bill perfectly here.

Moreover, North America is a hot market for automated AP solution, given its developed digital economy and the expansion of the mobile commerce industry in the region.

Per the recent American Express One AP Survey, 84% of U.S. business decision makers feel upbeat about transitioning to a digital payments mode. However, 79% respondents still relied on paper checks for at least some of their supplier payments before the COVID-19 pandemic struck while 44% confirmed that the majority of their payments were not made digitally before the outbreak. Also, 68% of the respondents believe that automated AP will lead to increased efficiency and time saving while 43% voted in favour of improved payment accuracy. Additionally, 37% felt that this method will lead to cost control in the long term while 34% views predict better cash flow management.

American Express One AP is the company’s latest product in a suite of solutions that it offers to assist businesses in regulating payments. The company collaborates with a bevy of leading innovators in the payment solutions space, such as Bill.com, Wex, Concur, MineralTree, Coupa and SAP Ariba.

Other companies, namely Mastercard Inc. MA and Visa Inc. V also offer automated AP services.

The stock of American Express has lost 23.8% year to date compared with its industry’s decline of 13.7%.

The company carries a Zacks Rank #3 (Hold), currently. A better-ranked stock in the same space is Jefferies Financial Group Inc. JEF, which holds a Zacks Rank #2 (Buy) at present. Its earnings surpassed estimates in the last reported quarter by 277.78%.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>


 


Click to get this free report

American Express Company (AXP): Free Stock Analysis Report

Jefferies Financial Group Inc. (JEF): Free Stock Analysis Report

Mastercard Incorporated (MA): Free Stock Analysis Report

Visa Inc. (V): Free Stock Analysis Report

To read this article on Zacks.com click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More