Batch Payments

What is Batch Payment Processing? Definition and Explanation 

Batch payment processing enables multiple payments to multiple vendors to be grouped and processed from the same bank account. A batch payment example is subscription-based businesses like Disney+ or SaaS providers like Notion or Mailchimp, where these businesses would bill clients monthly or bi-weekly. 

How to process manual batch payments?

The process itself can be done manually or automatically. In manual batch payment processing, you would have to get invoices approved to create payments. These payments would then need to be authorised by a CFO, CEO, or controller, allowing the check to come through. Though it may be tedious, this method gives you complete control in every step.

How to process automatic batch payments? 

Automatic batch payment processing requires an accounts payable automation platform to facilitate the payment process and payment consolidations without the hassle of manually processing them. However, there is a learning curve involved and hefty costs to maintain the software or platform. 

Batch payment processing is widely adopted in online marketplaces, which bridges the gap between vendors and buyers by enabling buyers to distribute payments to multiple sellers in one go, where the payment process typically takes 1-3 business days.