Across local government, councils are increasingly recognising the potential of emerging technologies to transform their back-office functions and change working practices to deliver real value.

Areas that are set to benefit in particular from this transition to digital are finance and procurement. Here, technology is already bringing significant improvements to local authorities’ operational efficiency and faster remuneration for their suppliers, most notably through the use of innovative early payment strategies.

An under optimised opportunity for many local government organisations until recently, early payment solutions use technology alongside process and change expertise to help organisations drive effectiveness and efficiencies within existing purchase to pay (P2P) processes. This means buyers can not only create new income and savings from existing cost streams but also achieve accelerated payments to suppliers in the process.

It’s a particularly timely innovation with the thorny issue of late payment still proving a perennial headache for the average small business. Indeed, the latest figures show more than 308,000 small and medium-sized enterprises (SMEs) considered themselves to be in financial difficulty at the end of the second quarter of this year, with as many as eight in 10 suffering from continual cash flow issues as a result of late payment.

Neil Copley, service director for finance at Barnsley Metropolitan Borough Council, spoke about the value gained from adopting the Oxygen Finance early payment programme.
“As council budgets get tighter, we have to look for ways to innovate and deliver better services for less. This was an ‘outside the box’ solution – but it is really working for the local economy and for the council”.

For the early adopters of this fresh approach to an age-old challenge, the benefits of a well thought out and operationally effective payment strategy are going well beyond the bottom line, for buyers and suppliers alike.