Case Study:

Win-Win for an american safety equipment manufacturer and their dealers by initiating consent based auto pull payments with deferral option


Do deploy a solution that could digitize and optimize the periodic pull-cycle of collections to a large MNC by providing flexibility to the payer and cash-flow visibility to the client.


One of the largest innovative product manufacturers worldwide in their India subsidiary had at least 1000 of its dealers/distributors signed up for an ACH based auto-pull payment system. Every month there were 4 debit dates (8th, 15th 22nd & 29th of the month) and all dues that fall between 2 pull dates would get auto-pulled on the next debit date.

[i.e. if there is 1 invoice due on 2nd of the month, 1 on 4th of the month and 2 on 6th of the month; then funds amounting to the total of all the 4 invoices are pulled automatically on the 8th]

The benefit to the dealers/distributors was that they enjoyed extra credit for invoices that are due before the debit dates. Also, if they are unable to fund their accounts on time, they can request for their invoice(s) to be deferred to a future debit date.

The Challenge

Despite giving flexibility to the dealers/distributors, there was a very high rate of bounce every debit cycle with an average success rate of less than 30%. This can be attributed to the following causes:

  • Deferment Request Mechanism: In order to request for their invoice(s) to be deferred, the dealers/distributors had to send an email request to a “Centralized Outsourcing Centre” that managed all the credit-related activities. Most of the time, these mails were not addressed/responded to on time. 
  • Inability of the Dealers/Distributors to View their Weekly Dues: The dealers did not have a live view of all outstanding obligations & credit notes; they were also not intimated about their weekly debit amounts.
  • Poor Visibility for Accounts Team: The local accounts team neither had a real-time view of all incoming requests nor could they act on requests. They were auto-approved by the outsourcing centre due to the sheer volume of requests and failure rates.
  • Limited Responsibility of Other Departments: The responsibility of managing the deferment requests was solely on the accounts team with little to no involvement from the business side.
  • Reconciliation: This was a major challenge for the finance team as they had to account for not only the successful debits and clear off customer ledgers to open credit lines but also the bounced transactions with reasons; this activity consumed 2 days after the debit date and got especially taxing during month/quarter/year ends.  

Our Solution

Global PayEx worked closely with the client’s Finance & IT team to customize and develop a unique solution that is able to address most of the concerns of the erstwhile process. 

PayEx offered the following solutions to their existing challenges:

  • Interface for Dealers: The dealers were given an interface (Web & App) to view invoices & credit notes; they could view & pay any time from within Freepay and it was automatically reconciled back at the ERP leading to short TAT for clearing credit lines.
  • Deferment Request Mechanism: The dealers/distributors were able to see the auto-pull debit dates under each invoice and had the option to request for deferment from within the interface. This made the process easier and transparent with a real-time view on the status of the request; increasing customer satisfaction due to an overall improved experience.
  • Live MIS across Business Functions: Live dashboard was provided to finance and business teams at various levels so that they could view in real-time the outstanding obligations and payments made by their respective customers.
  • Multi-level Deferment Approval Mechanism: A multi-level approval mechanism was developed for approving deferment requests by giving actionable dashboards to the business & accounts teams. Thus, the first approval is done by the sales lead for that particular dealer/distributor, next by the accounts lead for that BU followed by a final approver in finance. This way the responsibility was distributed to all business functions responsible for that particular dealer/distributor.
  • Payment & Reconciliation Automation: PayEx automated the presentation of the payments to the bank (calculating the total dues and applying credit notes) as well as reconciling the successful/failed transaction back to the ERP. This eliminated significant man-days of effort and reduced the risk of manual errors.

The Results

PayEx was able to increase the success rate of weekly debits to well over 70% within the first 4 cycles and has been able to reduce reconciliation time by 90%. This also meant removing the cost of running the “outsourcing centre” as all of the activities are managed by PayEx itself. 

By deploying PayEx, the client was able to not only simplify and improve their existing accounts receivables processes but also set up a platform to expand and on-board other non-ACH customers due to the superior customer experience offered.


Success Rate of Weekly Debits


Reduced Reconciliation Time

Get in touch with us