How to automate invoicing processing in 5 steps for improved cash flow

Automated invoice processing brings together AI, optical character recognition (OCR), and cloud software to handle the work that used to fall on your finance team's shoulders. It digitizes supplier invoices, extracts the relevant data, validates it against your records, and routes everything through approval workflows without anyone manually entering a single line item. The result is fewer errors, faster payment cycles, stronger compliance, and lower processing costs across your accounts payable operation.

The goal isn't to remove your finance team from the process entirely. It's to give them better tools so they can work smarter. When the software handles the tedious parts, your team gets to focus on reviewing exceptions, analyzing trends, and making decisions that actually require human judgment. Brex offers bill pay software that automates invoice capture and line itemization, payment drafting, approval flows, and reconciliation, saving time and controlling costs across the entire accounts payable workflow.

In a manual setup, finance teams do everything by hand. They receive invoices, sometimes physical ones, then manually input the data, cross check details, and route approvals through email chains or paper trails. Almost every step in this workflow is slow, repetitive, and prone to mistakes. When errors do happen, someone has to go back and redo the work, which drags out the entire lifecycle of an invoice from receipt to general ledger recording.

Automated invoice processing flips this on its head. Software steps in to capture invoice data, verify it against existing records, and route it through predefined approval workflows. Errors get caught early, approvals happen faster, and the entire process moves from days down to hours. Companies that use Brex bill pay's invoice capture technology are saving hours each month with up to 10x greater accuracy compared to manual entry.

This shift frees your team from busywork and gives them time back for the projects that actually matter. Instead of spending their afternoons reconciling spreadsheets, they can analyze spending patterns, identify cost savings, and contribute to strategic planning. That's a better use of their skills, and it's a better outcome for the business.

Successfully automating your invoicing workflow comes down to a few key stages. It starts with capturing the invoice data, then extracting and validating that information, routing it through approvals, and finally processing the payment and syncing it with your accounting system. Each stage builds on the one before it, so getting the foundation right matters.

Invoice capture

Not every invoice arrives the same way, and your automation software needs to handle all of them. Paper invoices can be scanned using a scanner or app to convert them into digital files that feed into your system. Electronic invoices, which usually show up as PDFs via email, can be uploaded directly or forwarded to the platform for processing. Some vendors even offer online portals where invoices can be pulled in automatically through integrations.

Brex makes this step simple by letting you drag and drop invoices, forward them by email, or even give vendors a unique secure link to upload invoices themselves. Once the invoice hits the system, Brex's AI auto captures every itemized detail, suggests a matching purchase order, and drafts a bill payment. However your invoices come in, they all end up in the same streamlined workflow.

Data extraction and validation

Once the invoice is captured, OCR technology reads the document and pulls out the key information like vendor names, invoice amounts, line items, and due dates. Think of OCR as the system's ability to read and convert unstructured documents into structured data that can actually be processed and analyzed. This eliminates manual data entry and dramatically reduces the chance of errors creeping in throughout your accounts payable processes.

From there, AI validates the extracted data by cross referencing it against your existing records. If something doesn't match up, the system either corrects it automatically or flags it for someone on your team to review. This means only accurate, verified data moves forward in the pipeline, which keeps your entire accounts payable workflow running smoothly. With Brex bill pay, companies reduce errors by 10x compared to manual entry thanks to this AI powered validation layer.

Handling invoices with unusual layouts, unexpected formatting, or international currencies can trip up basic systems. Brex's AI is built to manage that complexity, accurately extracting data regardless of how the invoice is structured. That gives finance teams the confidence to automate fully without worrying about edge cases slipping through.

Invoice approval workflows

Approvals are where manual processes tend to stall out the most. Invoices sit in inboxes, get lost between departments, or wait on someone who's out of the office. Automated workflows fix this by routing each invoice to the right approver based on predefined rules, and in the right order when multiple sign offs are needed. Whether it's a department head, project manager, or finance controller, every invoice lands with the right person at the right time.

Brex takes this further by letting you customize approval rules based on factors like invoice amount, vendor category, or project code. You can automate consecutive approvals, set up notifications when something needs attention, and alert specific people when all reviews are complete. Finance leaders get real time visibility into where every invoice stands, so nothing gets stuck and payments go out on time.

Payment processing and integration with accounting software

Once an invoice is approved, the final step is processing the payment and recording it in your accounting system. With automated invoice processing, approved invoices flow directly into platforms like QuickBooks or NetSuite without anyone manually transferring data. This saves hours of work and eliminates the double entry errors that come with toggling between systems.

This integration also gives finance leaders real time visibility into cash flow, which makes budgeting, forecasting, and financial reporting significantly easier. Reconciliation becomes simpler too, since every transaction is already coded and documented in one place. Brex connects with your accounting software through secure API integrations, ensuring that data moves between systems accurately and without risk to your financial information.

Step 1: Analyze your current invoice process

Before jumping into automation, take a close look at how your team handles invoices today. Map out the full workflow from the moment an invoice arrives to when it's recorded in your general ledger. Identify where things slow down, where errors tend to happen, and which steps require the most manual effort. You'll also want to consider the volume and types of invoices your team processes to understand what kind of scalability you'll need. This assessment gives you a clear picture of your pain points so you can choose a solution that actually solves them.

Step 2: Define your needs and goals

Once you understand your current process, get specific about what you want automation to accomplish. Set a budget and think through what kind of return on investment you expect in terms of time saved, cost reduction, and fewer errors. Consider how the new software will need to connect with your existing accounting tools so data can flow between systems without friction. It also helps to prioritize the features that matter most to your team, whether that's strong data extraction, vendor management capabilities, or the ability to scale as your business grows. Tying these goals back to broader business objectives like faster processing times and better financial visibility keeps your automation efforts aligned with what the company actually needs.

Step 3: Find the invoice automation software right for your business

Choosing the right invoice automation software solution is critical. Here’s a comprehensive checklist of essential features to look for:

• Ease of use and intuitive interface: Simplifies adoption and reduces training time.
• Scalability: Accommodates growing invoice volumes and expanding operations.
• Integration capabilities: Seamlessly connects with your existing accounting software, ensuring data consistency.
• OCR tech: Enables efficient data extraction from invoices, minimizing manual entry.
• Workflow automation: Automates approval processes, improving efficiency and reducing processing times.
• Data security and compliance: Ensures sensitive financial information is protected and meets regulatory requirements.

Each feature above boosts operational efficiency and is designed to support your company’s strategic financial management objectives.

Step 4: Integrate automated invoicing with existing accounting software

Getting your invoice processing software connected to your accounting platform is where everything starts to come together. Seamless integration eliminates data silos, reduces duplication errors, and speeds up financial reporting. Brex offers native integrations with popular platforms including an award winning NetSuite integration, along with connections to QuickBooks, Xero, and others. When your systems talk to each other, your finance team spends less time on manual data transfers and more time on strategic work that drives the business forward.

Step 5: Train and onboard employees

Even the best automation software won't deliver results if your team doesn't know how to use it. Invest in training sessions that fit different learning styles, whether that's online tutorials, live walkthroughs, or hands on workshops. Ongoing support and resources are just as important as the initial training, because they help your team stick with the new process over time. The more confident your employees feel with the platform, the faster you'll see the benefits.

In addition to thorough onboarding and implementation support from signup, Brex offers ongoing, 24/7 customer support via live chat, phone, SMS, and WhatsApp. This helps employees quickly learn how to use Brex, supports their needs beyond the implementation phase, and helps finance leaders get the best return on their investment in the program. "Brex’s dedicated implementation support had the whole organization up and running with corporate cards in less than a week," said Arlene Barbieri, Corporate Financial Controller at Medicinal Genomics. “I told our CEO that the transition would be easy. Thanks to the Brex team, I was able to keep my word."

Automation isn't just about saving time. It fundamentally changes how your finance team spends their day and what they're able to accomplish for the business.

Faster processing and payment cycles

When invoices move through a manual workflow, they get stuck. Someone enters the data, someone else checks it, and then it sits in an approval queue until the right person gets around to it. Automated invoice processing removes these bottlenecks by handling capture, validation, and routing in minutes instead of days. What used to take two weeks can happen in a few hours, getting every invoice payment out the door faster.

Speed matters for more than just internal efficiency, though. When you consistently pay vendors on time or early, you build trust and reliability into those relationships. For growing companies with lean finance teams, that reputation becomes a genuine competitive advantage when negotiating terms or onboarding new suppliers.

Lower processing cost per invoice

Processing invoices manually is expensive. Industry research estimates that handling one invoice manually costs around $12.42, compared with $2.65 when automated. The savings come from fewer labor hours, less paper handling, and approval workflows that don't require constant nudging and follow up.

Those numbers might seem small on a per invoice basis, but they add up fast when you're processing hundreds or thousands of invoices each month. For startups and growing businesses watching every dollar, streamlining every step of invoice processing means money you can put toward hiring, product development, or anything else that actually drives growth instead of maintaining the status quo.

Fewer errors and duplicate payments

Manual data entry is where mistakes live. A mistyped amount here, a duplicate entry there, and suddenly your team is spending hours tracking down discrepancies and processing corrections. These aren't just inconveniences. They're real costs that hit your bottom line and create headaches during invoice reconciliation.

Automated platforms catch these issues before they become problems. OCR captures data accurately from the source, AI validates it against your records, and built in rules prevent duplicate payments before they ever go out. Your team stops playing cleanup and starts trusting the numbers in front of them.

This kind of accuracy compounds over time too. Fewer errors mean fewer correction cycles, which means less time wasted on rework and more confidence in your financial data. When your numbers are clean from the start, everything downstream from reporting to forecasting gets more reliable.

Improved cash flow

When you can process and approve invoices quickly, you gain something manual workflows never offer, which is the ability to improve cash flow through deliberate payment timing. Instead of rushing to meet deadlines or realizing a payment is already late, your finance team can make strategic decisions about when cash goes out the door.

That control opens up real savings opportunities too. Invoice discounting and early payment terms from suppliers often go unclaimed by manual teams because they're still working through the approval backlog. Automation lets you capture those discounts while also avoiding the late fees that come from slow processing. It's a straightforward win for cash flow management.

Audit trails and compliance

Every invoice that moves through an automated system creates a digital record of what happened, who approved it, and when. Invoice tracking becomes effortless because that information is searchable, organized, and stored in one place. There's no digging through filing cabinets or chasing down email threads to piece together what happened six months ago.

When audit season comes around, your team is already prepared. The documentation exists, the approval chains are recorded, and everything ties back to a clear timeline. This kind of built in accountability makes regulatory compliance and internal controls much easier to maintain without adding extra work to anyone's plate.

For finance leaders who need to demonstrate governance and oversight, automated audit trails are a game changer. They provide the transparency that auditors and regulators expect while giving your internal team confidence that nothing has fallen through the cracks.

Freed up team capacity for strategic work

This is the benefit that doesn't show up on a spreadsheet but might matter most. When your finance team isn't buried in data entry and approval chasing, they have time to do the work that actually moves the business forward. They can analyze spending trends, improve forecasting accuracy, and contribute to decisions about where the company invests next.

For startups with small teams, this shift is especially meaningful. Automation lets three people handle the invoice volume that would normally require six, without the burnout. Your team gets to operate at a higher level, and the business gets more value from every person on the payroll.

Every finance team knows the frustration of manual invoicing, but the real cost often goes unnoticed because it's spread across so many small inefficiencies. Here are the most common pain points that add up when you're still processing invoices by hand.

Slow approvals and missed discounts

In a manual workflow, invoices can literally travel back and forth between departments before they get fully approved. Someone receives an invoice, reviews it when they have time, then passes it along to the next person. That person does the same, and so on. Depending on the type of invoice, there might be several people needed to sign off for approvals. On top of all this, extra time is needed for entering data, filing, processing payments, and coding into accounting software, versus accounting ERP integrations that occur with automated processes. No wonder the manual approach takes 14.6 days per invoice.

When approval cycles drag out, payments get delayed. Many vendors operate on net 30 or 60 day terms, and once you miss those windows, late fees start adding up. Even worse, late payments create frustration and tension with vendors that can damage relationships over time. In some cases, you might lose access to a supplier entirely and need to spend time finding and vetting a replacement.

Automating approvals keeps payments on schedule, protects your vendor relationships, and ensures you're in a position to take advantage of early payment terms instead of missing them. The difference between paying on time and paying late often comes down to whether your process can keep up with the volume of invoices hitting your desk.

Errors and inaccuracy

Manual invoicing leaves plenty of room for human error. Mistakes can happen anywhere in the process, from paying an invoice before services are delivered to mismatching a purchase order, receipt, and invoice during three way matching. Each error triggers a chain reaction of additional work. Someone has to find the problem, figure out what went wrong, void or resubmit the payment, and potentially deal with duplicate invoices along the way. Even something as simple as how to create an invoice correctly becomes a source of inconsistency when different team members follow different processes.

With automated processing, everything is tracked digitally. Accounting teams can manage invoices from anywhere, even from a mobile app. Brex lets you set up notifications based on various controls and settings, search invoice data quickly, configure reminders, and use AI to match purchase orders. You also get full visibility into payment tracking, real time financials, and spending insights that support accurate budgeting and forecasting.

Fraud risk

Manual invoice processing requires more hands-on intervention at every stage, which increases the risk of both internal and external fraud. Cybercriminals have become skilled at impersonating executives or suppliers to redirect payments, and paper based workflows make it harder to verify that requests are legitimate. There's also the risk of unauthorized access to financial statements and the potential for data manipulation.

Automated invoice processing provides a digital record of who makes payments, how much was paid, and exactly when it happened. The software is typically built on platforms designed to protect sensitive data from the ground up. Brex's secure platform includes encryption, idle lockouts, and two factor authentication to keep your financial information safe. You can also implement controls like separation of duties, assigning each employee a specific role to create a system of checks and balances that makes fraud significantly harder to pull off.

Lack of visibility and control

With paper based invoice trails, finance teams spend hours keeping track of physical documents and manually entering information into spreadsheets. Purchase order management becomes a mess when there's no centralized system connecting POs to their corresponding invoices. Teams end up toggling between folders, emails, and filing cabinets just to confirm whether an invoice matches what was originally ordered.

Automated processing changes this entirely. AI assists with invoice capture and entry, identifies spending trends, and generates customizable reports that give finance leaders the visibility they need to make informed decisions. Instead of piecing together information from multiple sources, everything lives in one system and updates in real time.

Wasted resources and inefficiency

Perhaps the most frustrating aspect of manual invoice processing is the sheer amount of time and resources it consumes from start to finish. The costs extend well past the salaries of the people doing the work. Storage, filing, document retrieval, and the constant back and forth all contribute to overhead that chips away at your bottom line.

These inefficiencies don't just cost money. They limit how quickly your finance team can respond to changing business needs and take on work that actually creates value. Automated invoice processing offers a straightforward alternative that streamlines operations, reduces errors, and frees up skilled employees to focus on driving growth and innovation instead of pushing paper.

For companies still relying on manual workflows, these hidden costs are often accepted as normal because they've always been there. But once you see how much time and money is being lost to inefficient processes, it becomes hard to justify not making the switch.

Most automated invoice processing solutions connect directly with popular accounting or ERP platforms like QuickBooks, Xero, and NetSuite. Once an invoice is approved, the data syncs to your accounting software automatically and the payment can be triggered or recorded without anyone manually transferring information between systems. This eliminates double entry and the errors that inevitably come with it.

The quality of that integration matters, though. Basic integrations might only sync vendor names and amounts, which still leaves your team filling in the gaps. Advanced integrations transfer line item details, tax information, project codes, and custom fields so that everything arrives in your general ledger with the correct coding and approvals already attached. The best solutions offer two way sync, pulling vendor information from your accounting software and pushing approved invoices back so both systems stay current without manual intervention.

When evaluating an automation tool, make sure it actually supports your specific accounting platform and the way your team uses it. Consider whether the integration handles your needs around multi entity support, custom dimensions, or approval workflows before committing to a solution. At Brex, we provide native API integrations that create seamless data flow between our invoice processing and your accounting software. This ensures that automation actually saves time rather than creating a new set of data management challenges to deal with.

As businesses continue moving toward digital operations, the demand for smarter invoice processing solutions will only grow. Automated software like Brex offers a platform that streamlines financial and accounting operations while enhancing accuracy, giving leaders real time data to steer their company in the right direction.

With Brex AI and OCR invoice processing technology, your teams can automate the process of extracting itemized data from a wide range of invoice formats. This eliminates manual data entry errors and speeds up turnaround times so that information is processed swiftly and accurately. Brex's auto matching capabilities also validate invoices against purchase orders and receipts, reducing discrepancies and strengthening compliance across your accounts payable workflow.

Brex also gives businesses the flexibility to tailor approval workflows to their specific needs. You can automate consecutive approvals, notify reviewers when content is ready, and alert specific people when all reviews are complete. Whether your organization manages approvals hierarchically or by exception, Brex adapts to fit your structure and keeps things moving without sacrificing compliance.

Automated invoice processing takes the most time consuming parts of accounts payable and turns them into a streamlined, accurate workflow. From invoice capture and data extraction to approval routing and payment processing, every step moves faster and with fewer errors when automation handles the heavy lifting. Your finance team gets time back, your vendors get paid on schedule, and your business gets cleaner financial data to make better decisions.

By adopting invoice processing best practices and pairing them with Brex's AI powered platform, you can reduce processing costs, prevent duplicate payments, strengthen compliance, and give your team the visibility they need to manage cash flow with confidence. The companies that move away from manual workflows now will be the ones best positioned to scale without letting accounts payable become a bottleneck.

Get started with Brex today and see how automated invoice processing can help your finance team work smarter, pay faster, and focus on what matters most.