The future of getting paid: AI vs automation

In 2023, Bill Gates wrote: “The Age of AI has begun… Artificial intelligence is as revolutionary as mobile phones and the internet.” Today we’re hurtling through the AI era at lightspeed, with headlines promising immeasurable impact - from managing your home life to enhancing how you walk with smart shoes. Even the UK government is promising to “turbocharge AI” with the AI Opportunities Action Plan.

But let’s get down to the bottom line - your bottom line. Can AI help you get paid faster? And if not AI, what tools can?

We picked a few of the wise minds at FreeAgent to get an understanding of the role AI plays within our software and its potential in the future. We also heard from some of our customers about their top tips for bringing in the bills.

Can AI write invoices for me?

For most business owners, invoicing is a key step towards getting paid. But are there ways AI can help? Generative AI tools, like Chat GPT, are increasing widely used as a way to help with content creation, ideation and to enhance customer support - but is there a place for them in invoicing? You could get AI to write you an invoice too… but there are reasons you should be cautious, says Dave Evans, FreeAgent’s Head of Data Engineering. “I would be very careful about using assistants like Gemini or or Chat GPT to help you write invoices,” he explains. “You’re talking about something that’s got a legal implication that you get it right. So it’s down to you to make sure your invoices are correct at the end of the day.” (Here’s a helpful example if you’re wondering what a great invoice looks like).

Whether it’s for invoicing or other areas of running your business, if you are exploring opportunities to start using AI, there are some considerations to bear in mind.

Ok, so a word of caution about AI there… but what tools can help me?

While now is not the time to hand over your invoicing to AI, the good news is there are tried and tested actions you can take to save time, streamline your processes, lighten your admin load and crack down on late payments. Enter automation. Now, let’s dive into the details.

How can automation help with invoicing?

There are some easy ways to simplify how you create and manage your invoicing accurately, while keeping visibility and staying in control. “Different types of businesses can set up models to save a lot of time and hassle… and extra features can make getting paid a breeze,” explains Dougie Anderson, one of our Product Managers.

For example, take FreeAgent’s recurring invoice profiles, which allow you to automatically invoice a customer for the same amount each month. If you use a payment solution, like GoCardless, alongside your accounting software, you can take that automation one step further. For example, you could automatically set up a request to take payment from your customer through a GoCardless Direct Debit - then that payment, and any related fees, can automatically be reconciled for you in FreeAgent. All that’s left to do is hit ‘approved’ and hey presto, you’ve been paid!

Automating the invoicing process is actually something our customers often mention. “I used to dread invoicing… It was exhausting, a total time drain, and took me away from the work that actually grows my business,” says Amy Cooper, Director at Chandler Watson Consultancy.

“Since moving to FreeAgent, invoicing has been a game-changer. What used to take days now takes minutes… No more admin headaches!”

Using accounting software has also made energy surveyor Ed Massingham’s invoicing more effective. “Prior to using [FreeAgent]… there was no ability to track whether [an invoice] had been paid or not. I lost so much money using my old ways. To use this system is not only a breeze, but ensures I’m getting paid for the work I’m carrying out,” says Ed.

Can I improve my cashflow with automation too?

Shockingly, one in four of the business owners who took part in our last Small Business Monitor survey felt their business’s future was in jeopardy due to late payments. Luckily, automating your payment process can help tackle late payments and avoid disrupting your cashflow.

Chasing invoices can be painful and time-consuming - not to mention a bit awkward. Avoid it altogether by setting up a late payment reminder template in FreeAgent to automatically chase unpaid invoices and (when needed) continue to chase once they’re overdue. Permanently strike that stressful task off your list.

For photographer and FreeAgent user Tim Gander, invoices that chase themselves have actually resulted in a decrease in late payments. “[FreeAgent] has streamlined everything from bookkeeping to invoicing and made chasing late payers a breeze! In fact, FreeAgent has cut the number of late payments to almost nothing, saving me time and money,” says Tim.

What else can I do to help with getting paid?

Knowing who pays late can be another way to protect your cashflow. But, depending on how many customers you work with, that can be tricky. To save you having to keep tabs, automated data analysis, like FreeAgent’s Radar intelligent insights feature, can assess patterns in your payments and spotlight who pays the fastest and the slowest. Then you can make informed decisions about who you’re working with and what to expect.

Are there any other changes I can make to my payment process?

Offering your customers more ways to pay can be a foolproof way of speeding things up. Accepting payments by credit or debit cards, Direct Debits, PayPal or different kinds of digital wallets can make it more convenient for someone to pay - and more likely that they’ll complete the task.

Payment providers like Tyl by NatWest, PayPal or Stripe for card payments, or GoCardless for Direct Debits can integrate with your accounting software so you can easily offer payment options on your invoices, including one-click payments. It doesn’t get much easier than that!

Enter our friend automation again. Payment providers can also automate more of the payment process. For example, they can successfully take the payment and notify FreeAgent. We then mark your relevant invoice as paid… and automatically explain any related transactions. “It’s automating that journey, from making it easy for your customers to pay to reconciling those payments for you. All you need to do is approve them as a final step. It really is a super fast way to speed up that kind of payment process,” explains Dougie.

Is there anywhere a sprinkling of AI might be good?

Some payment providers do offer additional AI-powered functionality that can come in handy - like GoCardless’s Success Plus, which is part of one of their tiered packages. It uses AI to action intelligent Direct Debit retries to find out when the best time is to attempt a repayment and ensure you get paid.

“You don’t have to worry about the hassle [of attempting a repayment]. And even if it does fail, there are still automated reminder emails to smooth out that process,” explains Dougie.

“Using all these tools in FreeAgent, alongside payment providers, can take all the admin burden off and it actually uses a bit of intelligence to save you time and the angst of payments failing, etc.”

Ready to automate your payment process?

Explore all the ways FreeAgent can lighten your admin load and help you get paid faster with a 30-day free trial.