Unlocking the Power of Invoice Scanning and Data Capture

In today’s fast-paced world, small businesses are embracing cutting-edge technologies to transform their accounts payable processes into models of efficiency and precision. At the heart of this evolution lies invoice data capture, a critical element now being revolutionized by automation. Gone are the days of tedious manual data entry; modern solutions offer faster processing and significantly reduced errors.

If you’re ready to take your business to the next level, the right invoice processing software can make all the difference. But how does it all work, and what’s the best way to get started?

In this guide, you’ll discover:

• What invoice scanning and data capture entail.
• The mechanics of automated invoice capture software and how it streamlines operations.
• How Envoice, our cutting-edge solution, simplifies invoice scanning and data extraction.

Get ready to revolutionize your workflow—read on to learn more!

What is Invoice Data Capture?

Invoice data capture is the process of extracting critical information from invoices, such as supplier names, amounts, line items, customer and order data, and other relevant data. This information is then converted digitally, where you can share it between various accounting and enterprise resource planning (ERP) systems.

Most small businesses could suffice with traditional invoice processing methods that often involve manual data entry. However, you might need invoice scanning software as your business scales to decrease costs and errors. It also allows you to process different invoice formats in a short amount of time, making your accounts payable system more efficient.

Common Issues With Traditional Invoice Scanning Methods

Manual invoice processing can bring several issues to your business’s financial operations, including delaying most accounts payable processes. Here are some common problems when using manual processing for your invoices:

• Inaccuracy – Traditional invoice processing often gives you a high chance of data entry errors. It can be caused by different factors, such as typos and data misinterpretation. Damaged or missing paper invoices can also cause inaccuracies in your invoice data.
  
• Labor-Intensiveness and Inefficiency – Doing invoice data capture manually for your business means that your employees must spend hours handling hundreds of paper invoices, potentially leading to payment delays when errors occur. This also gives your finance team less time for high-value activities, such as financial planning and budget forecasting.
  
• Lack of Transparency – One of the most significant drawbacks of processing your invoices manually is the lack of transparency and control over the entire workflow. It prevents you from tracking the status of each invoice and identifying bottlenecks within the system. It also results in problems in managing your cash flow and working capital.

These issues can seem daunting, especially if you’re still using a traditional invoice data capture system for your growing business. However, you can easily avoid them once you incorporate automated invoice data capture solutions into your accounts payable.

How an Automated Invoice Capture System Works

Automated invoice capture uses technologies like artificial intelligence (AI) and machine learning (ML) to reduce manual work, allowing you to integrate an AP automation system into your business. Here are its key steps:

1. Invoice Scanning and Upload – Paper invoices from various suppliers and vendors are scanned by taking a photo from the data capture solution. Next, it is preprocessed by removing distortions, making data extraction easier. Supplier invoices are also uploaded from their digital format.
2. Data Extraction – The invoice capture software now begins to recognize and convert the invoice image into text using optical character recognition (OCR) and other data extraction methods. Key invoice data, such as invoice number, due date, and other vendor details, are extracted during this step. AI can also help enhance the entire process of extracting unstructured data.
   
3. Data Validation – The extracted invoice data is validated for accuracy using AI, ensuring that all errors and discrepancies are corrected. AI could also help by cross-checking the extracted data with existing databases, such as purchase orders and contracts.
   
4. Automated Data Entry – After all the data is verified for accuracy, it is uploaded to the user’s integrated accounting or ERP system for further processing.
   
   

How Envoice’s AI Invoice Data Extraction Solution Works

Envoice uses AI for its core features, including invoice data extraction, processing, and approvals. This frees your team from repetitive tasks like manual entry and gives them more time to focus on high-value tasks. Here’s how our AI-powered data extraction works:

1. Invoice Scanning via the Envoice Mobile App – Employees can scan their invoices using the Envoice mobile app. The app can handle a variety of invoice formats, including paper receipts, e-invoices, and other digital formats.
2. Data Extraction Using SmartExtract – Envoice utilizes SmartExtract, an intelligent document processing tool, to accurately extract invoice data (e.g., line items and key vendor information) in seconds. This effectively eliminates manual data entry and reduces errors, making it a suitable tool for accounts payable automation.
   
3. Data Validation With ExactExtract – Envoice then checks the captured invoice data for discrepancies using ExactExtract with Human-in-the-Loop review and corrections, ensuring 99.9% data accuracy. This makes your AP workflow more efficient and streamlined. Our platform also offers a line item extraction service, letting you automate expense distribution to specific cost centers and projects.
   
4. Automated Data Upload on Other Financial Systems – Envoice allows you to seamlessly integrate your accounts with other accounting platforms, like QuickBooks Online, Xero, and Microsoft Dynamics 365. You can upload extracted invoice data to different platforms via automatic two-way sync.

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Benefits of Using Automated Invoice Capture Software

Incorporating automated invoice capture technologies, such as OCR invoice scanning tools and AI, into your AP process has various benefits. Here are some of them:

#1. Faster Invoice Processing Times

The time that it takes to process an invoice is critical. Technologies such as AI, machine learning, and optical character recognition make it significantly faster for you to capture and extract key invoice data, allowing your finance team to approve expenses efficiently and resulting in better vendor relationships and employee satisfaction.

#2. Minimizes Errors From Data Entry

AI-driven invoice scanning software is designed to reduce errors from data entry and delays caused by manual delegation in your accounts payable department. This eliminates the chances for duplicate invoices, typos, and other mistakes that can cause payment delays.

#3. Increased Productivity and Financial Oversight

Modern invoice capture software that uses advanced technologies automates key invoice processing steps, resulting in a streamlined workflow and allowing your finance team to focus on high-value tasks. Transitioning to digital invoices makes internal and external audits easier and prevents fraud.

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#4. Reduced Invoice Processing Costs

Sticking to traditional invoice processing is often labor-intensive and prone to errors, which lead to delays and more costs. Capturing invoice data accurately with OCR technology and AI allows you to significantly reduce processing times, delegate more valuable tasks to employees, and eliminate tedious tasks like manual entry.

Storing invoices in electronic formats and cloud storage is cheaper than keeping them physically on desk file drawers, where they could easily be tampered with, lost, or damaged.

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4 Best Practices for Automated Invoice Scanning and Data Capture

Automated invoice scanning and data capture software can be overwhelming to implement in your AP system. However, it’s proven to pay dividends in your business’s future, especially financially. Below are five best practices you can follow when using invoice capture software:

#1. Standardize Invoice Formats

When using invoice scanning solutions, it helps to receive standardized invoice formats from your suppliers and vendors. Ideally, you’d want to receive them in PDF files and other electronic formats to extract data faster and process them accurately.

#2. Search for an AI-Powered Data Capture Solution

If you’re already implementing OCR software to your invoice processing workflow, you can consider upgrading to an intelligent invoice capture tool to extract key data accurately and at a faster rate. Also, be sure to look for invoice scanning software that offers seamless integration with your accounting software and ERP system.

Note: Extract data efficiently and accurately with our AI-powered solution, SmartExtract. Save time, reduce errors, and ensure accurate financial records. Contact us today to streamline your data extraction process!

#3. Test the Invoice Capture Software Out

Test your invoice capture solution with a few sample invoices to check its accuracy and effectiveness before fully applying it to your AP automation workflow. This allows you to identify issues and solve them quickly. It also lets you reduce costly delays for future invoice processing.

#4. Keep Your Software Up-to-Date

Make sure to keep your invoice capture software updated to its latest version and equipped with new features and security updates. This enables you to secure sensitive financial and customer data from malicious actors and cyberattacks.

Final Thoughts

Modern invoice processing software allows you to reduce delays and costs from manual data entry. It lets you extract data from receipts in their digital format, providing more accurate financial records and lowering costs from keeping paper invoices. Choosing the appropriate invoice data capture solution for your business is crucial, especially when transitioning to a streamlined AP automation system.

If you’re searching for a reputable pre-accounting and AP automation solution with AI-driven features, consider Envoice. Our software uses artificial intelligence and machine learning for critical steps in invoice processing, such as data extraction, validation, approvals, and workflows. It also integrates with popular accounting and finance tools (e.g., QuickBooks Online, Xero, Sage 50, etc.), allowing you to seamlessly transfer data to your accounts via automatic two-way sync.

Ready to streamline your operations and enhance productivity? Try our automation features today and transform how you manage accounts payable. Contact us to get started!