No matter what the size of your business, Reconciliation is one of those issues that take their lives. Let's find out why e-commerce payment reconciliation is important in your business and what the challenges are with doing well.
What is a reconciliation of payments?
In simple terms, the process of checking whether the amounts paid into your bank accounts are the same as what was done in your business books. It not only provides you with a complete picture of your business's revenue but also helps you to identify inconsistencies. It strengthens your business against those rare mistakes that come from banks while transferring money.
Why is payment reconciliation so challenging?
Although payment reconciliation seems like a straightforward process, it is not, however, because of the many challenges facing accountants and analysts while reconciling transactions. Reconciliation files are sent to retailers by receivers highlighting all their transactions and expenses. These reconciliation files are used by accountants to match bank statements and/or transaction records.
Let's see what challenges they faced as they did so.
Sync files from multiple recipients
It is probably a common practice in the gambling industry to have two or more winners. While this is good for the business in terms of cascading performance, durability, reduction, and many other reasons, it can unknowingly add to the difficulties in the reconciliation process. Recipients have completely different financial and payment structures (net/sum).
Recipients have a variety of times when they make reconciliation files available to vendors. Other payment methods such as Paypal, SEPA take longer. These reconciliation files do not match with fragments from various recipients. One needs to keep track of these times and combine them into a single sync file at any time.
Multiple file formats
While this may not seem like a problem to many, it still affects a number of marketers who must first take the pain of converting a recovery file into a compiling or linking format on their tools. These recovery files are provided in various formats such as Excel, CSV, PDF, or Text.
Refunds and rebates
If making reconciliation against bank statements was not a trivial process, repayment and refunds bring a whole new level of difficulty. Customers need a refund to be processed very quickly. It is extremely difficult for a seller to return a purchase without first repaying it, as he risks allowing a counterfeit transaction to pass or refunds money that was never received before. Apart from this, bank statements and reconciliation files that are at the crossroads of confusion due to refunds and refunds, can only show one kind of truth.
Panacea
In order to be effective, the reconciliation process needs to be done at a critical level in order to take resources and time that costs the business a lot of money. As an administrative function, it has to go into more than a little to be done properly. One needs a proper way to collect reconciliation files from all receivers and payment methods. Thereafter the standard format for merging all these files into one file. Now, this file can be used by an accountant/analyst to synchronize transactions with bank statements and letters. No incomparable transaction or lost money!
The conclusion
E-commerce Reconciliation payments do not have to be so complicated. Nowadays, a number of tools have been developed to make reconciliation as painless as possible so that accountants can comply with various statements. But the above challenges remain a challenge. In order for reconciliation to be non-binding, traders need to help their traders deal with these challenges in removing the basic difficulties of reconciliation. We hope we have been able to inform you about the challenges in reimbursement and show you where to look.
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