Top 7 invoice processing challenges & How zerotouch automation solves them

In 2020, one of the world’s largest food distributors, Sysco Corporation, faced severe payment delays during the pandemic when its finance team, which handled thousands of supplier invoices daily, was forced to work remotely. With most of their invoice approvals and document exchanges still handled manually through paper and email, the accounts payable (AP) team struggled to match purchase orders, verify line items, and route approvals across different departments.

According to the Accounts Payable Association (APA) reports, Sysco wasn’t alone; over 60% of businesses during that period reported increased invoice backlogs, missing invoices, and late supplier payments due to manual, non-digital processes. Many suppliers halted deliveries or demanded prepayment, causing production and supply disruptions across sectors like manufacturing, FMCG, and healthcare.

These challenges exposed the weak spots in manual invoice processing systems that rely heavily on physical documents, manual data entry, and email-based approvals. Even as organizations resumed normal operations, the aftereffects lingered: high error rates, duplicate payments, lost invoices, compliance issues, and low visibility into outstanding liabilities.

In this blog, we’ll explore the seven most common and critical problems professionals face with manual invoice processing, backed by real industry data and insights from finance and procurement teams worldwide.

The old way of invoice processing: Why it’s holding businesses back

You know how invoice processing usually goes: someone makes a spreadsheet, someone else updates it, and then there’s that one email thread that never ends because five people need to “approve” it. Half the time, a bill goes missing or the numbers don’t match, and you spend hours trying to figure out what went wrong.

It’s slow. It’s messy. And honestly, it’s draining.

For most businesses, it still takes around 8–10 days to clear a single invoice when done manually. Add up the time, the people involved, and all the follow-ups, and you’re easily spending? 1,000 - ?1,500 per invoice. That’s not even counting the stress.

But business today doesn’t move at that speed anymore. You’ve got to be quick, stay compliant, and get things right the first time. Manual processes can’t keep up; they cause delays, errors, and constant back-and-forth. It’s not that people aren’t trying hard; it’s just that the system itself isn’t built for how fast things need to move now.

Top 7 problems professionals face with manual invoice processing

1. Slow processing and payment delays

Manual invoice processing depends heavily on human effort at every stage, from receiving and reviewing the invoice to entering details, verifying data, routing for approval, and finally issuing payment. Each step introduces waiting time, especially when invoices are passed between departments or when approvals rely on email or physical signatures.

This multi-step, human-dependent process causes significant slowdowns. Even a small error or missing field can stop the invoice from progressing, requiring clarification from vendors or internal stakeholders. As invoice volumes increase, bottlenecks become more frequent, extending payment cycles from days to weeks. Late payments damage supplier relationships and cause missed early payment discounts, while finance teams lose the agility to manage cash flow effectively.

2. Human data-entry errors and inaccuracies

Data entry errors are one of the most common and costly issues in manual invoice processing. Each invoice typically contains multiple data points: supplier names, invoice numbers, PO details, tax codes, amounts, and dates. When entered manually, any mistyped digit or misplaced decimal point can create mismatches between invoices and purchase orders.

Such inaccuracies lead to reconciliation challenges, disputed payments, and frequent rework. Over time, this undermines data integrity across accounting and ERP systems. Finance teams are then forced to spend hours verifying entries, correcting mistakes, and revalidating transactions, diverting valuable time from analytical or strategic activities.

3. Duplicate payments and matching failures (3-Way / 2-Way)

Matching invoices to corresponding purchase orders (POs) and goods receipts, a process known as 2-way or 3-way matching, ensures payment accuracy. However, in a manual environment, this verification depends on staff visually comparing documents or cross-referencing spreadsheets. With high invoice volumes and inconsistent document formats, errors and oversights are inevitable.

Duplicate invoices can easily be processed and paid if they aren’t identified early. Similarly, mismatches between invoice amounts, PO values, or received goods often go unnoticed until reconciliation. These matching failures lead to overpayments, supplier disputes, and prolonged month-end closings, ultimately affecting financial control and accuracy.

4. Lack of visibility, tracking, and audit trail

In manual workflows, invoices often move through the organization without a centralized system to monitor their status. Once received, they may sit in an employee’s inbox, await manual review, or be physically transferred between departments. As a result, finance teams lack real-time insight into where an invoice is in the approval chain or why it’s delayed.

This absence of visibility makes it difficult to forecast payables, monitor cash flow, or identify process inefficiencies. Finding a single invoice or demonstrating its approval chain during an audit takes a lot of time because the paperwork is dispersed over shared folders, emails, and paper archives. This fragmented approach weakens financial governance and slows decision-making.

5. High operational cost and poor scalability

Manual invoice handling involves repetitive administrative work, data entry, validation, filing, and exception management, all performed by human staff. As an organization grows, the invoice volume increases, but the process itself does not become faster or more efficient. To maintain throughput, businesses often have to hire additional staff, increasing operational expenses.

This model does not scale effectively. The cost per processed invoice remains high, while productivity per employee declines. Instead of focusing on analysis or vendor management, finance teams are consumed by low-value, transactional work. Over time, this inefficiency limits an organization’s capacity to handle growth without proportionally increasing headcount and cost.

6. Fraud, Security, and Compliance Risks

Manual invoice processing environments are vulnerable to both internal and external risks. Paper or email-based invoices can be easily altered, duplicated, or fabricated. Without automated verification or consistent approval protocols, fraudulent invoices may go undetected. Additionally, manual workflows often lack segregation of duties, a key requirement for financial compliance.

Data security is another concern. Sensitive supplier and payment information may be stored in unsecured files, shared folders, or email chains. Tracking who accessed or modified an invoice is difficult, leaving organizations exposed during audits or investigations. These weaknesses make it harder to ensure adherence to tax regulations, internal policies, and external compliance standards.

7. Lost or misplaced invoices and long exception resolution times

In a paper or email-driven process, invoices can easily be misplaced or lost during internal transfers. If an invoice is printed for review, left on a desk, or buried in an inbox, it can delay the entire payment cycle. When exceptions occur, such as missing purchase orders, incorrect amounts, or disputed line items, resolving them becomes a manual back-and-forth between departments and suppliers.

This lack of centralized tracking extends resolution times and increases the likelihood of duplicate submissions or missed payments. Every lost or delayed invoice not only affects vendor trust but also complicates month-end reconciliation and cash flow accuracy. Over time, the cumulative impact of these exceptions can significantly slow down financial operations.

The strategic value of going zero-touch

1. From reactive to proactive finance

Zero-Touch Invoice Processing turns finance from a back-office support role into a proactive, insight-driven function. Instead of reacting to issues such as missing data, delayed approvals, or late payments, finance teams gain real-time visibility into every stage of the invoice lifecycle. Automated checks and intelligent workflows identify exceptions instantly, allowing teams to act before problems impact operations. This shift helps finance evolve from processing transactions to managing outcomes and driving business strategy.

2. Faster, Predictable payment cycles

By eliminating manual handoffs and approval delays, zero-touch automation accelerates invoice processing from days or weeks to hours. Automated matching, routing, and validation ensure invoices are paid on time without human follow-up. This consistency strengthens supplier relationships and builds trust through transparent, predictable payment behavior. Vendors experience fewer disputes, and organizations benefit from improved cash flow management and opportunities to capture early payment discounts.

3. Accelerated period closing

Manual reconciliation and data verification often slow down financial closing cycles. With zero-touch systems, these processes occur continuously and automatically in the background. Invoices are validated against purchase orders and receipts in real time, ensuring that books are always current and accurate. This enables faster month-end and quarter-end closings, improves reporting precision, and gives leadership teams access to near real-time financial data for decision-making.

4. Strengthened compliance and audit readiness

Zero-touch workflows inherently build compliance into every transaction. Each invoice action from capture to approval is automatically logged, creating a complete digital audit trail. The system enforces business rules and approval hierarchies, reducing the risk of policy violations, fraud, or unauthorized payments. When audits occur, documentation is instantly retrievable, reducing audit preparation time and ensuring transparency across all payable activities.

5. Workflow redesign for resilience and speed

Zero-touch automation is not just a layer of technology; it’s a redesign of the finance workflow for long-term stability and speed. By removing repetitive manual steps, finance teams become less dependent on individual capacity or location. Processes continue seamlessly even during volume spikes or workforce changes. The result is a resilient, scalable finance operation that delivers consistent performance, improved accuracy, and faster cycle times regardless of external conditions.

How zero-touch invoice processing actually works

1. Automated invoice intake

Invoices are automatically captured from multiple sources, including emails, supplier portals, EDI feeds, or direct document uploads. The system detects incoming invoices in real time and digitizes them instantly, removing the need for manual scanning or data entry. This ensures every invoice enters the workflow promptly and consistently.

2. AI-Powered data extraction

Once captured, the system leverages artificial intelligence and optical character recognition (OCR) to extract critical invoice data. This includes vendor details, invoice number, PO references, dates, line items, tax amounts, and total values. The platform is designed to handle diverse invoice formats, ensuring accurate extraction even from non-standard templates.

3. Automatic verification and matching

Extracted data is validated against purchase orders and goods receipt records through automated two-way or three-way matching. The system confirms that quantities, pricing, and delivery details align with contractual terms. Invoices that meet all criteria proceed automatically, while mismatches are flagged for review, reducing the risk of errors or overpayments.

4. Exception management

Invoices that don’t comply with validation rules are routed as exceptions. Predefined workflows ensure these exceptions reach the appropriate personnel for quick resolution. Automated tracking keeps the process transparent, so exceptions are resolved efficiently without slowing down overall invoice processing.

5. Automated approval routing

Once validated, invoices are routed through an automated approval process. Approval paths are dynamically determined based on rules such as department, invoice amount, or project codes. Approvers can review and authorize invoices digitally via web or mobile interfaces, eliminating slow paper-based or email approvals.

6. ERP and Accounting system integration

Approved invoices are posted directly into ERP or accounting systems with all relevant fields populated, including GL codes, vendor data, and tax details. This seamless integration ensures that financial systems are updated with accurate, validated information, reducing manual effort and improving reporting reliability.

7. Payment Scheduling and Execution

Invoices are automatically scheduled for payment according to vendor terms and internal policies. The system can interface with banking networks to execute payments electronically via NEFT, RTGS, ACH, or other methods. Automation ensures timely payments, reduces human errors, and supports effective cash flow management.

8. Complete audit trail and Archiving

Every step in the process is recorded in a secure digital log, from invoice receipt to payment execution. Historical invoices and related records are archived for easy retrieval during audits or compliance reviews. The system provides full traceability, reduces paperwork, and strengthens governance and regulatory adherence.

Conclusion

The way we handle finance is changing fast. What started as simple automation scanning invoices, routing approvals, syncing data is now moving towards something bigger: autonomous finance.

Imagine systems that don’t just follow rules but actually learn from your business patterns, spot anomalies, and make smart decisions on their own. That’s where the future is headed, from “doing things automatically” to “thinking automatically.”

And the first real step in that direction is zero-touch processing, removing manual effort from routine financial tasks so your team can focus on strategy, not data entry.

TYASuite’s Zero-Touch Invoice Processing module helps businesses get there faster. It lets you process invoices without the manual drag faster, error-free, and always compliant.

Automation today. Autonomy tomorrow. That’s the path forward.