A majority of U.S. states have issued “stay-at-home” orders. With this in mind and for future reference, having tools and systems in place to run your business remotely is crucial for business survival.
Cristina Lynch, owner of Mi Golondrina, a boutique women’s and children’s clothing line with designs inspired by Mexican artisan culture, recalls her last encounter with business disruption and used the experience to inform her decision-making as the COVID-19 pandemic unfolded. Having survived Hurricane Katrina, Lynch swiftly communicated with her staff and decided to shift everything online a week ahead of most other businesses.
“We’ve closed our Dallas, Houston and San Antonio stores to protect the safety of our customers and employees, but we’re going to try and ramp up our online orders by offering free shipping,” says Lynch. “Our sales team will be working remotely to service customers digitally, and we’ve adjusted our marketing efforts to focus on digital storytelling.”
Mike Lee, senior vice president and sales manager of global transaction services at East West Bank, interacts frequently with business owners. He understands the importance of having the right tools and services available for business owners to carry out their functions remotely.
“Some of the things we hear from customers, primarily, are that they can’t get into the office, so they don’t have access to things like checks, mail and printers,” says Lee. “Businesses on the frontlines of engaging with customers are also worried about the risks involved with exposing their employees and customers through physical transactions and are looking for more digital ways to do this.”
Here are a few things businesses can set up now to ensure effective remote working conditions.
The most efficient way to keep funds moving in and out of your business is to use online banking. Most banks offer the option for business (as well as personal) accounts to be accessible digitally. Being able to do so will help you track account balances and payments in real time. Even simple changes such as being able to submit checks remotely through an easy-to-use scanner and sending your deposit securely to the bank online can be a huge help.
Remote deposit capture eliminates the need to prepare deposits and make physical trips to the bank. It also extends same-day deposit cutoffs by allowing businesses to deposit checks the same day online.
“If you’re trying to get your deposits in the fastest and safest way without actually having to go to a bank, the remote deposit capture is one option. Another secure way in which to pay your employees without having to issue a check, is to explore ACH payments,” says Nadilee Russell, senior vice president and director of global transactions at East West Bank.
"If you’re trying to get your deposits in the fastest and safest way without actually having to go to a bank, the remote deposit capture is one option. Another secure way in which to pay your employees without having to issue a check, is to explore ACH payments."
Automated Clearing House (ACH) payments are electronic payments that eliminate the need to write paper checks or to pay with debit or credit cards. They are one of the most used payment types in the U.S., processing more than 20 billion payments per year. Money moves automatically from a bank account and can be executed for high-volume payments with more accuracy and efficiency.
The most common uses of ACH are payments for loans, taxes, vendor and supplier payments and direct deposit of payroll. ACH payments are an efficient and cost-reducing alternative to paper checks and credit cards. With ACH, customers can streamline and automate their accounts payables and accounts receivables processes - and save time, resources and costs, said Lee.
How is ACH different from a wire transfer? “Wire transfers are another type of electronic funds transfer, but are usually higher dollar amonts and used when money needs to be delivered within minutes, whereas ACH transactions are often high volume, recurring batches of payments that does not need to be delivered the same day,” explains Lee.
Convenience, security and accuracy are the main drivers for businesses that switch to ACH payments. The setup is like a wire transfer, where the business establishes a payee and directs the bank to submit the payment. With the ability to accept and disburse payments through the ACH system, this has become a popular tool used by many businesses.
Bill pay offers electronic payments and check payments that are issued by the bank so that business owners don’t have to issue those payments themselves. “Once registered for bill pay, the business can start creating payees and issuing payments to anyone within the U.S., regardless of whether if it’s a vendor or an individual,” says Ricardo Perez, assistant vice president and GTS product manager at East West Bank. “The checks or the electronic payments are processed by the bank and eliminates the extra steps for businesses having to manually cut the check, have it signed and put it in the mail themselves.”
Enrolling in bill pay is a simple process, and while the set up can take a few days, the service is ready to go immediately upon set up. “Once businesses create a payee in the bill pay application, they are ready to make their payments, and they have the opportunity to register for E-Bills for certain payees or vendors. E-bills is a solution where businesses can receive invoices electronically from bill pay.” Electronic payments can be processed quickly for next-day payments.
In addition to the ease of implementing bill pay, the service also comes with alerts and reminders for payments. Businesses can schedule payments for recurrences and have the flexibility to set multi-user approvals to establish levels of control on outgoing payments. “With bill pay, you can designate a user to require approval for any payments that are initiated,” says Perez. “So say I create a user and have them pay invoices, but I still want to review them, I have the ability to do that.”
How does bill pay differ from ACH payments? “It’s really not the same solution as ACH because ACH allows businesses to pay more in batches with multiple recipients at one time,” says Perez. “Bill pay is an electronic form of writing a check, allowing you to pay your bills one at a time and schedule your payments. ”
Integrated payables support businesses in need of better financial efficiency. Using the existing information in your accounts payable system, you can create and send one file for all of your payments (ACH, Wires and Checks). You can also customize the instructions for each payment, such as payment date, method and approval process. Once the file is imported to integrated payables, the bank will take care of the rest and keep you updated on payment status.
With integrated payables, businesses have an upper hand by having a secure system, eliminating manual dual entries, enabling straight-through processing, allowing businesses to review and release high-value payments online, and setting alerts for businesses when files are received and processed.