Construction companies can now build structures that generate as much renewable energy as they consume. They can construct smart roadways imbedded with sensors that detect traffic flow. What even the most imaginative builders can’t do, however, is know when a scammer might be scheming to hack their payment system.

That reality has led a growing number of construction businesses to rethink the way they pay their subcontractors and suppliers. Rather than rely on a stand-alone accounts payable function, many are choosing to integrate their payment processing capabilities directly into their accounting systems. Integrated construction payment processes offer multiple advantages. Among them:

• Reduced data exposure risk – Many companies currently enter invoice data twice: once in their accounting system and again in their payments system. By integrating these functions on a single platform, they eliminate the risks associated with manual data entry and transferring sensitive payment information between systems.
• Real-time fraud detection – Most integrated payment solutions include advanced fraud detection tools that analyze transaction data and identify potentially fraudulent activity, enabling businesses to mitigate risks in real-time.
• Controlled access – Solutions can be configured so that only authorized personnel can access sensitive payment information and processing functions.

Beyond Fraud Protection

Integrated payment processes do more than enhance payment safety. They can also help you reduce overhead. For example, with invoice automation – digitizing invoices and integrating them into your accounting workflow – it’s possible to reduce your cost-per-invoice substantially, compared to paper-based manual systems.

Integrated payments processes also enable you to expand the payment methods you use. For example, certain payment hubs make it possible to pay contractors and suppliers using their preferred payment method – virtual card, ACH, check or wire – from your existing system.

You can also transform your accounting department into a revenue center by replacing paper checks with virtual cards, which earn a revenue share on every payment.

A revenue share is also included when you use purchasing cards to buy goods and services. The purchasing cards available today let you set spending limits and other controls for each user. Multiple fraud-prevention tools look for transactions in restricted merchant categories and activity that matches current fraud trends.

These are just a few of the many integrated payments system solutions now available. All are designed to reduce labor needs and provide greater visibility into financial data, which can lead to everything from better decision-making and improved cash flow, to lower storage costs and auditing time. The construction businesses with the most to gain are those that still pay most invoices using checks.

The bottom line: By integrating their payments processing capabilities into existing accounting systems, construction businesses can improve their financial safety, streamline their operations and focus on achieving the things that matter to them.

This article has been previously published by Commerce Bank, available at commercebank.com/business/trends-and-insights/2024/financial-safety-in-an-integrated-construction-payments.