Commercial Financing Payment System Automation
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Solution Overview
Problem
The conventional scheduled payment plan in commercial financing is inefficient, leading to late fees, labor-intensive invoice management, and lack of flexibility for both customers and finance companies, with no easy mechanism for disputing invoices or managing funds effectively.
Innovation Solution
A software system and method allowing customers to control their accounts, specify payment dates and methods, automate fund transfers, and dispute invoices, providing customizable access and tracking features for both customers and finance companies.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Stability of the object's composition
If the standard scheduled payment plan is used, then coordination and forecasting of payments is improved, but customers may incur late fees and interest charges due to lack of timely invoice information
Solution Approach 1:
The system sends automated email notifications to customers before invoice due dates, allowing them to take preliminary action to arrange payments before the deadline. This prevents late fees while maintaining the structured payment coordination of the scheduled payment plan.
Solution Approach 2:
The system provides real-time feedback to customers about upcoming payments, current account status, and payment history through automated emails and online account access. This feedback loop ensures customers are informed timely to avoid late payments while maintaining payment coordination.
2Measurement precision
If manual invoice entry and payment monitoring is used, then detailed tracking is achieved, but labor costs and processing time increase significantly
Solution Approach 1:
The system automatically generates invoices, sends them to customers via email, and monitors payment status without requiring manual intervention. Finance company staff can access online accounts to view and manage customer information, eliminating the need for manual data entry and mail processing while maintaining accurate tracking.
Solution Approach 2:
The system replaces manual mechanical processes (physical mail, handwritten checks, paper-based tracking) with automated electronic systems including email communication, electronic fund transfers, and database-driven account management. This substitution maintains precise tracking while dramatically improving processing efficiency.
3Ease of operation
If payments are manually posted to accounts, then payment application can be controlled, but errors and delays in fund management occur
Solution Approach 1:
The system replaces manual posting of payments with automated electronic fund transfer tracking and account updating. When customers make payments through the system or via electronic transfer, the system automatically applies funds to the correct accounts and updates balances in real-time, eliminating manual errors while maintaining operational control.
Solution Approach 2:
The system provides immediate feedback when payments are received, automatically updating account balances and notifying relevant parties. This real-time feedback mechanism ensures accurate payment application without manual intervention, reducing errors while maintaining control over fund management.
4Reliability
If invoices are mailed to customers, then formal delivery is ensured, but processing time and administrative costs increase
Solution Approach 1:
The system replaces physical mail delivery with automated email transmission of invoices and payment notifications. Emails provide immediate delivery confirmation through read receipts and tracking, eliminating the weeks-long mail cycle while maintaining reliable delivery. Electronic invoices can be accessed immediately by customers, dramatically reducing processing time.
5Device complexity
If the finance company decides which invoices to pay, then centralized control is maintained, but customer flexibility and resource management are reduced
Solution Approach 1:
The system provides dynamic payment options where customers can choose to pay specific invoices early, make partial payments, or defer payments within available credit limits. The system adapts to customer needs while maintaining centralized oversight, allowing flexible payment strategies such as prioritizing high-interest invoices or coordinating with cash flow patterns.
Solution Approach 2:
The system allows customers to segment their payment decisions by individual invoice, enabling them to pay some invoices in full, partially pay others, or defer specific payments. This segmentation provides granular control over payment decisions while the finance company maintains overall account management and credit monitoring.
Data Source
AI summary
A commercial financing payment planning system and associated method provide commercial financing customers the ability to retrieve and monitor account activity, track scheduled payment dates, and create/submit remittance instructions online. The system provides numerous functions to a customer, such as customer payment control, access to multiple payment sources by the customer, automatic funds transfer, customized user access, a customer dispute process for disputing supplier invoices, automatic dispute response, and credit tracking. With payment control, the customer specifies which and on what date the invoices will be paid, and the source of funds for the payments. The customer can make these payments from one or a combination of sources. By creating a remittance advice document, the customer can specify in advance payment details and give authorization for automatic payment by the system. The customer can also customize access to control features of the system of the invention for each of the customer's accounts/receivable employees. In the event that the customer has an issue with a supplier's delivery, product, or pricing, the customer can submit a dispute to a supplier. The customer, supplier, and finance company can view a payment dispute and dispute status through the entire dispute process. The system automatically e-mails the customer a response when the dispute is resolved, informing the customer of the result of the resolution. Both the finance company and the customer can track credits applied to the customer's account through the entire dispute process.