It’s been a decade littered with unprecedented challenges in the field of supply chain management. However, while businesses have been forced to endure the pandemic, geopolitical constraints, and added environmental pressure, we’ve also seen a series of emerging technologies rise to the fore to provide fresh optimization opportunities.
The result has seen a renewed emphasis on resilience, and thanks to enhancements in the field of artificial intelligence, automation, and blockchain technology, we’re seeing more firms succeed in cutting their expenses while optimizing their supply chain management capabilities.
One key area where there’s plenty of room for optimization is in the incorporation of payment technology to improve long-standing industry inefficiencies.
The relationship between supply chain management and fintech can be complex, and in terms of improving the payments ecosystem beyond borders concerning suppliers, the innovation potential is seismic.
Extending to the realms of payment technology, digital payments, advanced financial services, and blockchain capabilities, fintech tools have the potential to optimize a multitude of processes relating to supply chains, and businesses stand to reap the rewards from enhancements that are helping to remove the friction associated with international transactions:
Process Automation
We’re living in the midst of an artificial intelligence boom, and early adopters of AI-enabled supply chain management have reduced their logistics costs by 15%, improved inventory levels by 35%, and enhanced their service levels by 65%.
Global trade platforms are increasingly utilizing generative AI tools to transform their payment processes. While artificial intelligence is excellent at automating monotonous tasks like data entry, processing payments, and managing inventory, it can also help to reduce the friction in leveraging transactions between vendors.
Through the ability of AI and machine learning (ML) tools to build analytical insights surrounding inventory and customer behavior, more businesses can automate their ordering systems to prevent instances of stockouts. When the AI considers the inventory level to be insufficient for keeping up with demand over a given period, it can automatically pay for restocking without the need for human intervention.
Through ML processes, this payment can be made most cost-effectively at a time when transaction fees are lower.
Embedded Payments
In recent years, payment flexibility has evolved from a desirable to an essential practice for vendors. Today, supply chains don’t need to be burdened by fiat currencies, conversions, and delays due to undesirable price movements.
Through embedded online payments, vendors have the freedom to utilize hundreds of alternative payment methods that can range from digital wallets to cryptocurrency payments while using automation tools to provide real-time visibility over price conversions, fees, and reporting.
Embedded payments help to cater directly to globally focused supply chains, preventing unnecessary delays when it comes to keeping up with invoices and maintaining compliance regardless of the jurisdiction and industry regulation in place.
Crucially, this opens the door to a future where supply chains can be optimized through cryptocurrency payments, which possess a decentralized framework that makes it far easier to transfer across borders.
Rather than keeping up with fiat currency rates, which can be susceptible to short-term price shifts due to many different geopolitical and economic factors, money can be transferred throughout a supply chain more sustainably over borders by using cryptocurrency.
Instead of conversion rates, this strategy means that vendors will merely need to account for transaction fees, which can help to deliver an unprecedented degree of payment efficiency for all parties.
Digital Invoicing
Payment automation can also thrive thanks to digital invoicing tools. Transitioning invoices and payments into digital channels, this more automated approach to invoicing helps to remove lengthy and error-prone human processes within financing workflows while moving away from depending on physical documents and manual operating models.
Automation technology means that generative AI tools can automatically extract key information from invoices, cross-check the specified data, and action the payments without the need for any human intervention.
As blockchain technology becomes more commonplace within the industry, we’ll see this process become even more efficient with the help of smart contracts, which can be structured to automatically execute based on the meeting of pre-determined conditions between involved parties.
These processes can help to strengthen vendor relationships while ensuring the swift payment of goods and parts.
Supply Chains and Payment Efficiency
Modern supply chains may be facing greater challenges and strain, but the proliferation of technologies like AI, blockchain, and automation tools are leading the fight back against payment inefficiencies across borders.
With the help of embedded payments, cryptocurrency, and self-executing smart contracts, more vendors can strengthen their relationships throughout the supply chain to create a seamless experience for all players at every step of the chain.
These measures can form the backbone of an efficient supply chain that’s ready for any uncertainty that lies ahead. In creating a more adaptable and streamlined supply chain, more businesses can set themselves up for greater levels of resilience in an uncertain future outlook. By preparing for tomorrow now, your business is well-positioned to build a positive customer experience off the back of a supply chain that’s well future-proofed.
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