AP Automation & Payments
When Electronic AP Still Isn’t Straight-Through
New Federal Reserve research shows why electronic invoices and payments do not always produce true straight-through processing.
By Accounts Payable Professionals Group | October 2, 2026
Accounts payable departments have spent years replacing paper invoices, manual data entry, and checks with electronic systems. Yet employees still spend time correcting invoice data, moving information between systems, resolving exceptions, and matching payments.
New research from the Federal Reserve Bank of Cleveland explains why.
Published September 25, 2026, the research examines the barriers preventing businesses from achieving true straight-through processing (STP). STP means a business transaction can move from one stage to the next with little or no manual intervention.
STP Is Bigger Than Invoice Automation
The Cleveland Fed divides a B2B transaction into five phases:
Each phase can introduce manual work. Automating invoice capture alone, therefore, does not create STP.
A Simple AP Example
Imagine a supplier sends a $5,000 invoice against a $5,000 purchase order. The goods have been received.
The invoice automatically matches the PO and receipt, posts to the ERP, moves into the payment run, reaches the bank, and is reconciled without AP manually moving or rekeying the transaction.
That is straight-through processing.
Where Automation Breaks
The Fed identifies several barriers that prevent businesses from reaching this level of automation.
Invoice formats are fragmented. Paper and PDF invoices may require data entry or extraction. Even electronic invoices can require manual handling when their format is incompatible with the buyer’s AP system.
Supplier portals create friction. A portal may automate invoice delivery for the buyer while creating work for suppliers that must manage many customer portals. The Fed describes this problem as supplier portal fatigue.
ERP and payment systems do not always communicate. Legacy systems may not connect directly with banks or support modern payment formats. AP employees may still need to transfer payment instructions or payment information manually.
Payment and remittance information can become separated. When remittance data travels separately from the payment, suppliers may have to manually determine which invoices were paid. Missing or incorrect invoice information can create additional reconciliation exceptions.
Payment standards also differ. ACH, cards, wires, and instant payments can use different message formats. Moving information between those formats can create errors, lost data, and processing delays.
Can AI Solve It?
AI, machine learning, and optical character recognition can help extract invoice and remittance information from different formats.
But the Fed cautions that automated extraction remains imperfect. Human review and corrections may still be required, while the technology itself adds cost and complexity.
What AP Should Take Away
AP leaders should look beyond the invoice when measuring automation.
- Can suppliers be onboarded electronically?
- Can invoice data enter the ERP without rekeying?
- Can invoices match and route automatically?
- Can approved payments reach the bank without another manual process?
- Can payment and remittance information be reconciled automatically?
If employees repeatedly copy, rekey, download, upload, translate, or manually match information between these stages, the process is not truly straight-through.
The Cleveland Fed’s research gives AP professionals an important way to rethink automation.
That makes integration, interoperability, master data, payment information, and exception management just as important as invoice capture.
Sources & Further Reading
Federal Reserve Bank of Cleveland
B2B Payments: Business Processing and Challenges to Achieving
Straight-Through Processing
Published September 25, 2026
Federal Reserve Bank of Cleveland
B2B Payments: A Gradual Shift from Checks to Electronic Payment Methods
The Federal Reserve research also references work from the Business Payments Coalition, Nacha, Accredited Standards Committee X9, Digital Business Networks Alliance, Association for Financial Professionals, and other payments-industry sources. The complete bibliography and supporting references are available in the original Cleveland Fed research.
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