Automated Invoice Processing
The end-to-end capture, validation, approval, and posting of supplier invoices by software—replacing manual data entry, email routing, and paper filing with OCR, AI-driven match rules, and straight-through ERP integration.
Key Facts
Alternate names: touchless AP, e-invoice automation, straight-through invoice processing
Workflow stages: capture (OCR/EDI/Peppol) → data extraction & validation → PO / receipt match → policy & budget checks → approvals → ERP posting → payment queue
Core technologies: optical character recognition (OCR), AI/ML data-extraction engines, three-way-match rules, RPA bots, e-invoicing networks, ERP & payment-gateway APIs
Key metrics: first-pass match rate, touchless invoice %, average processing time, cost per invoice, exception rate
Why It Matters
Cuts processing costs – Automating capture and matching slashes labour, driving cost per invoice from $9–15 to as low as $2.
Speeds cycle-time – Straight-through approvals reduce invoice-to-pay time from weeks to days—unlocking early-payment discounts and avoiding late fees.
Reduces errors & fraud – Duplicate-check algorithms, PO mismatches, and vendor master validations flag anomalies before money moves.
Boosts visibility & control – Real-time dashboards let finance and budget owners see liabilities instantly, improving cash-flow forecasting and accrual accuracy.
Strengthens compliance – Every field capture, match decision, and approval is audit-trail-ready for SOX, VAT/GST, and ESG reporting.
Real-World Examples
Global Retailer
Receives 120 k invoices/month. AI-OCR + three-way match achieves 93 % touchless processing; AP head-count redeployed to supplier-relation tasks, saving US $3.8 M annually.
Mid-Market Manufacturer
Migrated from emailed PDFs to Peppol e-invoices. End-to-end processing time dropped from 10 days to 2, enabling 1 % early-payment discounts worth €450 k per year.
Diagram / Visual (optional)
Pipeline: Invoice Capture (OCR/EDI) → Validation & Match Engine → Exceptions Queue → Approval → ERP Posting → Payment Run — with KPIs displayed beneath each stage.
Related Terms
Three-Way Match
Procure-to-Pay (P2P)
Accounts Payable Automation
E-Invoicing
Frequently Asked Questions
Q: Do we still need human approvers?
A: Policy-compliant, perfectly matched invoices can auto-approve, but exceptions—price variances, missing receipts, new vendors—still route to humans.
Q: What’s a good first-pass match rate target?
A: World-class AP teams hit 85 %–95 %; anything below 70 % suggests issues with PO accuracy, goods-receipt discipline, or supplier data quality.
Q: Will automated processing work with non-PO invoices?
A: Yes—AI can classify and route non-PO invoices to the correct cost centre or requestor, though auto-approval rules are usually stricter.
If you have any questions or need further assistance, feel free to reach out to our
support team.
