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Dynamic Discounting

Dynamic, or Early Pay, Discounting

In a typical scenario where an organization is selling items to a customer, they must wait an average of 40 days to receive payment for the invoiced product.

Dynamic Discounting

Suppliers want to get paid as fast as possible. In a typical scenario where an organization is selling items to a customer, they must wait an average of 40 days to receive payment for the invoiced product. This means the “frozen” capital is temporarily unavailable for the organization to use in other areas. Buyers typically want to balance retaining capital while maximizing discounts. In the past, buyers try to negotiate discount terms that meet capital cost requirements set by their treasury. However, suppliers don’t always want to be stuck with such a long term commitment. With the innovative Dynamic Discounting and electronic invoicing options by iPayables, buyers are always assured they are meeting the capital cost requirements for discounts while allowing suppliers select discounts based on their needs.

Dynamic Discounting is also known as “early pay discounting.” Dynamic Discounting provides ample time for the supplier to be notified that the invoice is approved and can be paid early with a discount. The Dynamic Discount is controlled by the customer, and customers usually require much less than rates offered by factoring agencies. Suppliers can either opt for the Dynamic Discount, or select a date to be paid and the application will let them know what the exact discount will be. This makes cash flow forecasting more accurate and relieves some of the reporting burden placed on the accounting department.

We use advanced algorithms in real-time to determine the appropriate discount for the supplier based on the selected date. The supplier agrees to the Dynamic Discount and can look forward to a payment that meets their schedule. Once the supplier decides the date they want to be paid for their product or service, InvoiceWorks® automatically calculates the discount amount. It’s that easy.

FAQs

Why Switch to E-Invoicing?
For among other things, better accounts payable efficiency and easier cash flow management. There are numerous other reasons to switch to electronic invoicing with iPayables, contact one of our implementation specialists and find out more.
How much will I save by switching to iPayables?
Probably a bunch! A recent study suggested that most organizations pay anywhere from $3 – 13 per invoice for traditional paper invoicing. With electronic invoicing with iPayables, your invoicing cost can be reduced to $1- 3 per invoice. With the larger organizations processing tens of thousand of invoices per month, the potential savings per year can sometime be hundreds of thousands of dollars!
Do I need to install anything on my computer?
You should not need to install anything on your computer. If you are having technical difficulties using iPayables, contact your technical support group or call us at the number at the top of the screen.