Of all the spaces in financial services and with all the new technology, SMB finance confounds. Neither a singular person nor a large corporation, SMBs exhibit both consumer and business financial needs. Tracking purchasing and spend, in particular, is a quagmire of processes and accounting procedures.
On Monday, three important upstarts in the corporate spend/business banking category launched new products with Accounts Payable functionality.
The new products:
- Brex revealed its new AP offering Payables, combining bill pay, corporate card spend, and T&E reporting into a single platform.
- Rho launched Accounts Payable, where invoices sent to a designated AP inbox are digitized for bill payments.
- Ramp announced Ramp Plus, a new suite of procurement tools to help finance teams with procurement-related tasks, like approval workflows, global expense capabilities, and payment card controls.
The advantage with AP tools: By pushing out more capabilities and automation in AP tools, these firms are hoping to get a bigger slice of their clients' total spend.
“As a result, some of that spend will be on their Brex card, one way in which Brex earns revenue,” co-CEO and co-founder Henrique Dubugras told TechCrunch. “Plus, using a Brex business account for bill pay, another way in which Brex earns revenue, allows customers to send payments faster, eliminating ACH delays while also earning passive yield.”
Also good for clients, good for fintechs: Instead of cobbling together different legacy providers, these firms offer their clients the vision of more tightly integrated tools. “[Businesses are] fed up with their legacy AP providers and want a modern solution that’s directly integrated with the rest of their finance stack,” Rho CEO Everett Cook said to TechCrunch.
Scaling by removing complexity: AP automation tools obviate the need to hack procurement systems in-house. For example, Shopify announced that it was an early customer for Ramp's new procurement suite.
“Our needs are incredibly complex. We tried to build a platform ourselves but found Ramp to be the perfect fit with the features we needed, now and in the future. Ramp has shown the commitment we need from a long-term partner, supporting our decade-long hypergrowth," Phil Whitham, Director and International Controller at Shopify told VentureBeat.
Piggybacking on AI: Advances in generative AI may also play a role in the slew of new AP automation products hitting the market.
While Brex has used artificial intelligence in its underwriting and customer service, the firm has now partnered with machine learning companies like Scale AI and Photon to improve the accuracy of the information it extracts from invoices, according to TechCrunch.