Cash Management

Effortlessly manage your cash flows

Streamline your financial operations to ensure liquidity, stability, and growth by integrating tools that optimize incoming and outgoing transactions.

Cash Management vs. Merchant Services

They are two sides of the same coin, but for different parts of a business's financial flow

Cash Management

Cash Management focuses on managing the business’s own money. It involves services that help a business control and optimize their cash flow. This can include:

Account management (business bank accounts, sweep accounts)
Bill payments and collections
Cash flow forecasting
Investment options for idle cash

Merchant Services

Merchant Services focus on how a business accepts payments from customers. These services help businesses receive money efficiently. This can include:

Credit card processing (merchant accounts)
Debit card processing
Point-of-sale (POS) systems
Payment gateways

cash management

Why is it important?

Tips for improving your cash flow

What is ACH?

Cash Management

Cash management services can help maintain the liquidity your business needs for smooth operation at an affordable cost. We provide the tools you need to administer your company’s incoming and outgoing transactions without a hitch, which enhances the stability of your business and improves your ability to access capital for further growth. These systems integrate with your business banking software to execute the three main goals of cash management: maximizing profits, settling debt and other obligations promptly, and earning interest on idle funds.

Larger corporations may refer to cash management as treasury management, a department that usually includes chief financial officers, treasurers, accountants, and other business managers. Smaller companies often completely outsource their cash management solutions.

Cash management also involves tracking metrics associated with your business. Reviewing cash flow reports each week, month, quarter, and year will help keep your company on track to meet both small and large financial milestones. These documents include a thorough accounting of cash that goes into and out of your business, including accounts receivable, accounts payable, financing payments, and invested funds. On the last line, you can see how much cash your business has available at-a-glance.

Why is it important to your business?

When your business has a stable, sustainable cash management system in place, you have the foundation for long-term survival and financial growth. Maximizing the amount of cash available to pay your business debts also allows you to unlock the profit potential of your enterprise. With this process in place, you’ll be able to see your available cash at a glance for enhanced accessibility to and control of the funds that flow in and out of your business. With American United Federal Credit Union, we can connect you with cash flow solutions that make sense for your operation.

Tips for Improving your Cash Flow

Spend Carefully: The higher your costs, the more money that flows out of your business. Think carefully about whether a new expenditure will support the company’s financial health before taking the leap. It might make more sense to allow the funds you would have spent to earn interest for a rainy day.
Use Credit Wisely: This tip applies to both business borrowing and allowing your customers to use credit for purchases. Before taking on a new loan for inventory or equipment, make sure the payments and interest will work with your worst-case-scenario budget. If your company extends credit to customers, have a clear approval process in place to avoid losing money when clients default on the loan.
Minimize Inventory: Generally, you should only have enough stock on hand so you can serve your current customers. Avoid the temptation to take advantage of economies of scale. Though you might get a discount for buying materials and inventory items in larger quantities, you won’t save on the deal if you don’t end up selling or using what you purchase.
Have an Emergency Fund: As with your personal budget, your business budget should have a cash reserve to cover about three to six months of expenses. These funds will help ensure you can pay for the basics such as inventory and payroll even if business slows for a time.
Track Invoices Carefully: Many small businesses struggle to collect from clients who fail to pay. Getting over this hurdle can positively impact your cash flow. Develop a tracking system to record each invoice and determine whether you have received payment. Set up reminders, automated if possible, to remind customers to send their payments. You may want to institute a late-fee or interest system when payment lags.

What is ACH?

In the United States, an organization called the National Automated Clearing House Association facilitates electronic funds transfers and transactions through its Automated Clearing House systems. When your business creates this type of transaction, you are the ACH originator. Your customer provides the authorization to charge the credit or debit card for payment. Typically, ACH processes and completes these transactions within a day of initiation. Once this occurs, the bank will have the authorization to transfer the purchase price from the customer’s account to your client’s account. If you have employees you pay with a direct deposit system, each paycheck also represents an ACH transaction.

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