How much do incorrect payments cost your company?
Incorrect payments of supplier invoices occur in all companies and organizations.
15% of incorrect payments are never recovered
Our analyses show that companies recover an average of 85% of incorrectly paid supplier payments. The main reason for this is that the supplier contacts the company and returns the incorrect payment. Another reason is that the company itself discovers the error and contacts the supplier. 15% are never recovered.
What types of payments are the 15%?
- Small amounts that the supplier considers to be more costly to resolve than they are worth.
- Inadequate procedures at the supplier. A payment that does not match a claim is entered as an open item without contacting the customer.
- The most serious type. The payment is made to a company that is not your supplier. It ends up with an untrustworthy company, or even a fraudulent company that has no intention of helping to rectify the incorrect payment.
Cost of payments recovered
Although companies recover an average of 85% of incorrect payments, this work involves a cost. Contact by telephone and/or email to verify account numbers and references. Follow-up to confirm that the money has been repaid.
Investing in tools to prevent incorrect supplier payments before they occur is therefore a sound business decision.
About the author
Mathias Grahn, analyst at Betalkontroll