Digitalization of financial services: Automated capture of 200,000 invoices annually using OCR technology

With more than 120 customers and 35 years of experience, "nordwest Factoring & Service GmbH" from Hamburg is one of the leading medium-sized factoring companies in Germany. The company offers its customers full-service factoring, i.e. a full range of financing, security and services. The factoring service provider places particular emphasis on speed, customer proximity, flexibility and reliability.
 

Initial situation

The customers of nordwest work internationally in a diverse range of industries: Logistics & Transport, Wholesale, Personnel Services and Industry. Each of these companies (creditors) has its own customers (debtors, approx. 35,000 in total) who use their services and need to be charged accordingly. In this context, nordwest takes over the entire accounts receivable and receivables management. 

One of the main tasks here is the capturing, verification and archiving of all incoming invoices and receipts (approx. 200,000 pieces per year), which are submitted via different channels: by e-mail, by mail or now and then also by fax. These processes were previously handled manually, i.e. the invoices were checked personally by the employees, then captured individually in the ERP system and finally archived on the server drive. A situation that ties up too many personnel resources on this scale, is no longer up to date and, above all, severely restricts the company's growth plans. The decision to take over further factoring companies was already strategically determined at this point in time and is to be realized in the future with as little additional personnel as possible.
 

Our Task

Simon Schach - one of three managing directors at the factoring company - commissioned SITEFORUM to design and implement an interactive portal that can be used productively by both customers and employees and offers a high level of automation. 

As a customer, invoices should either be uploaded directly to the portal via a login or sent conveniently to the portal by e-mail. The invoices should then be processed automatically and checked for plausibility, so that employees only have to check deviating data. Finally, the checked data should be able to be transferred to the ERP system in order to trigger further processes such as limit checking or payment. In addition, archiving should be automated and each invoice should be easy to find.
 

Our Solution

SITEFORUM first made a 2-week inventory and process analysis in Hamburg to get a clear picture of the existing software landscape as well as the critical processes in the daily business. Based on this analysis, a concept was created and development started.

As requested by the customer, the portal consists of two areas that are closely connected: the customer portal and the productivity portal for employees. For the submission of invoices, a comfortable upload was integrated directly in the customer portal (login required). For the user-friendly submission of invoices by e-mail, SITEFORUM provided a mail server with customer-specific e-mail inboxes, which are automatically fetched from the portal. 

All submitted invoices are then processed in batches within seconds using OCR technology and artificial intelligence (AI) and checked for plausibility, i.e. are the correct bank details on the invoices, does the amount match the calculation, does the customer number match the customer account, etc. The data is then provided to the nordwest staff in the so-called „Invoice Inbox". However, SITEFORUM does not rely on a standardized OCR analysis but on a flexible solution to analyze invoices according to the exact specifications of the client.

The final verification of the extracted and "pre-checked" invoice batches is made in a clear split screen (invoice on the left, data on the right) by the staff in a quick run, as only invoices with deviating data have to be manually checked.

Once the final invoice data has been transferred to the ERP system, the data is also automatically archived. The archive is also provided with a search function so that invoices can be found within seconds on the basis of various criteria.
 

Results

Just a few days later, the time saved by the automated capture and verification of invoices was already noticeable for the employees. 

"We have never captured invoices as quickly and easily as we do via the new portal. In individual cases, we save up to 100% of the previous capture time. That's truly awesome!"

And nordwest now also looks forward to the acquisition of new factoring companies in a relaxed way: 

"Without the portal and the process automation, we would definitely need to plan more time for a takeover and also increase staff to deal with the mass of data. Now the portal works for us and reduces our workload. It also keeps our backs free for other issues, for which we now have more time!"

Not long after that, the management of nordwest ordered further expansion stages to automate other important processes and to increase customer convenience even further. Those are already being planned and should be in productive use by the end of 2022.