American Express has announced enhancements to Early Pay in the US, the company’s supply chain payment solution to give large companies that establish an American Express Corporate Purchasing Card account  - and their suppliers - the ability to pay and get paid when they want through a digital platform. 

Initially launched in 2018, American Express’ Early Pay solution has evolved to provide benefits to both buyers and suppliers. It is designed to help buyers have greater control of their accounts payable (AP) process for their business-to-business (B2B) payments, generate extra cash from early payment discounts and finance their payments should they need the working capital. Early Pay provides suppliers the ability to help optimise their cash flow by accepting early payment offers from their buyers, in exchange for a discount. 

“As we continue to focus on enabling digital payments beyond our traditional Corporate Cards, we are investing in solutions to improve the buyer and supplier experience and help solve common B2B payment-related pain points,” said Daniel Brachfeld, vice president/general manager, Supply Chain Solutions at American Express. “Right now, businesses are more focused on digital transformation than ever before, with 84% of US business decision makers saying they feel positive about transitioning to a digital payments system. The latest evolution of Early Pay provides a supply chain solution that will give businesses more flexibility to help manage their payments and cash flow easily and efficiently. This comes at a time when businesses are seeking a simple digital solution among a rapidly evolving and fragmented supplier payments landscape.”

Optimising supplier payments for buyers

According to a study this year from Barclaycard, the adoption of automation and early payment discount functionality could enable businesses to realise an estimated US$8.84bn in uncaptured savings from discounts. The enhanced Early Pay solution includes the ability to:

• Optimise cash flow by capturing invoice discounts through early payments funded and made by either American Express or the buyer.
• Turn potential cash discounts from early payments into savings and working capital.
• Reach and engage new suppliers through American Express’ fast and simple digital implementation process.

Enhancing the supplier experience

According to The B2B Payments Innovation Readiness Report, a PYMNTS and American Express Collaboration from September 2020, nearly 15% of B2B receivables are late - a problem that can worsen if the supplier does not follow up in time. When a buyer is late to pay, it can put suppliers in a stranglehold, making cash flow their biggest challenge. 

American Express says that using Early Pay, suppliers will be able to:

• Choose to accept discounts on all invoices, or on an invoice by invoice basis, to automatically get paid early through the American Express Early Pay digital platform.
• Rely on a fast and easy onboarding, payment and reconciliation process.

The payments firm says that Early Pay will continue to evolve with additional features and benefits rolling out in 2021.