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What Are Electronic Payments?

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Electronic payments, also known as e-payments, encompass all transactions conducted online or electronically. These payments exclude cash and paper checks and are facilitated through methods such as credit and debit cards, ACH, and bank wires. 

Benefits of Electronic Payments

Both businesses and their suppliers can reap the benefits of electronic payments and e-payment systems. E-payments offer several advantages in accounts payable, including cost reduction, improved relationships, better payment record-keeping, and enhanced security. 

The processing expenses are lower 

E-payments significantly reduce processing costs for businesses by eliminating paper and postage expenses. This means no time is spent on printing or mailing checks, resulting in potential cost savings of up to 80%. 

Enhanced security 

Electronic payments are known for their heightened security and reliability compared to traditional checks and cash. Depending on the e-payment system you use, you can track expenses and receive transaction notifications, bolstering your financial security. Additionally, e-payment methods often feature robust authentication processes for enhanced security. 

Better records 

Managing e-payments is considerably more straightforward than tracking traditional check or cash payments. You can easily access your company’s payment history with a few clicks. E-payments also simplify financial metric tracking and overall accounting procedures. 

Improved relationships with suppliers 

E-payments foster smoother relationships with suppliers. You can set up automatic recurring payments, which prevent potential delays, and the added security and prompt responses contribute to stronger business-to-business relationships. 

Different Options for Electronic Payments

Electronic payments have evolved since their introduction as a convenient payment option for bills and goods and services. Today, companies have access to a range of e-payment types: 

Bank transfers 

Money can be transferred between banks using various methods, commonly through direct deposit or, in the US, ACH transfer payments. 

Card payments 

The most popular electronic payment method remains credit and debit card payments. This method includes virtual credit cards, offering a high level of security. 

Cross-border payments 

Cross-border payments enable businesses to send and receive money globally, involving various methods like bank transfers, forward contracts, and currency exchange transactions. 

Advantages and Disadvantages of Electronic Payment Types

It’s unlikely that any business will rely solely on one electronic payment method for their accounts payable, as every business and vendor is unique. Understanding the pros and cons of each type of e-payment is crucial for wise selection: 









ACH Debit Pull 

Reduced or eliminated fees

Batches may lead to several business days for processing

Fewer disputes compared to credit card payments

Some fraud risk


ACH Credit Push 

Reduced fees

Not free

Suitable for recurring payments and one-time payments

May take several business days to complete


Credit Card 

Faster processing

Higher fees compared to other payment methods

Convenient with all necessary information on the card

Minor fraud risk


Debit Card 

Easy to use

Associated fees

Reliable for vendors

Some security concerns



Commercial Card 

Low costs and reduced fees

Challenges in tracking

Swift processing


Enhanced security




Virtual Card

Enhanced Security

Not universally accepted by vendors

Secure through payment tokenization


Often come with rewards



Purchasing Card (P-Card) 

Fast and convenient

Tracking challenges

Low-cost processing

Increased risk of fraud


Wire Transfer 

Quick processing, sometimes same-day for domestic transfers

Potential fraud risk

Accessible to anyone with a bank account


Why Businesses Need E-payments

Businesses that persist with paper checks are missing opportunities for more efficient operations. Here are some reasons your company should consider transitioning to electronic payments: 

Fewer expenses 

The true costs associated with check payments, including paper, ink, and postage, can add up. In contrast, ACH transfers and other electronic payments are considerably more cost-effective. 

More convenient 

Electronic payments eliminate the complexities of printing, signing, and mailing checks. ACH transfers and virtual cards are two common electronic payment methods, streamlining payment processes. 

Higher security 

Electronic payments employ encryption and security features like tokenization, reducing the risk of data breaches and fraud. 

How Can Accounts Payable Software Help Businesses with Electronic Payments?

Although e-payments are efficient, they can be tedious and time-consuming when done manually. Accounts payable (AP) software can significantly reduce costs and processing times: 

  • Avoids late charges: Automation helps ensure that payments are made on time, avoiding late penalties. 
  • Offers increased visibility: AP automation provides a dashboard for better oversight of payables, making it easier to address delays or discrepancies. 
  • Improves financial systems’ precision: Fewer errors are found in business operations after implementing AP automation. 
  • Effortless integration: AP automation seamlessly integrates with financial systems, databases, and ERPs. 
  • Decreases Fraud: By delegating responsibilities, business owners can closely monitor AP activities, reducing fraud risks. 


In conclusion, Rewardworks offers AP automation solutions that enhance efficiency and reduce costs in your business’s payment processes. Our collaboration with American Express, Corpay and Wex leverages cutting-edge tools to ensure you never miss a payment. Contact our team or request a demo to elevate your electronic payments with us. 
Picture of Paul Schille
Paul Schille
Paul Schille is the Vice President of Sales at Interopay. He is responsible for all customer-facing groups including sales, customer success, account management, and partnerships. Paul is a roll-up-your-sleeves, entrepreneurial executive with an exceptional track record of growing, managing, and turning around software and multi-unit franchise businesses. From startups to established brands, he focuses on sustainable growth and healthy margins while building teams that understand the goals and how to make the vision a reality.

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