Weekly Business Insights 05/01/2025

How to identify and prevent duplicate payments in accounts payable

We’d all like to think we’re immune to making duplicate payments, but the truth is, that even the most diligent organizations pay the same invoice twice. These costly mistakes impact healthcare systems of all sizes — from small hospitals to big healthcare providers and duplicate payments drain millions in revenue each year. But they don't have to.

While most finance teams understand the ins and outs of payment processing, the way duplicate payments sneak into systems has grown increasingly sophisticated. What starts as a simple oversight like processing both an emailed and mailed version of the same invoice  can quickly cascade into significant financial losses. Add in the complexity of modern business operations, with multiple departments and payment systems, and you've got a perfect storm for payment errors.

Modern AP automation software has transformed how businesses handle payments. Smart spend management platforms use advanced algorithms to automatically flag potential duplicates by checking multiple data points  invoice numbers, amounts, dates, and vendor information. It's like having a digital watchdog that never gets tired and catches things human eyes might miss. Platforms offer features like automated two-way matching and even three-way matching, comparing purchase orders, receiving documents, and invoices to ensure everything aligns before payment. They can also standardize invoice formats, automatically capture data from emails and scanned documents, and maintain a clear audit trail of every transaction.

How to Identify and Prevent Duplicate Payments in AP | Brex

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What are Duplicate Invoices, Why It Fails to Detect and How to Avoid It

Duplicate invoices or double invoicing occurs when a business receives the same invoice more than once with very slight differences in the invoice attributes. These could be invoice numbers, dates, amounts or even invoice descriptions. But duplicate invoices and consequent payments also occur when a single invoice received from a vendor is mistakenly entered twice in the system and paid twice for the same goods or services. Studies show that organizations make duplicate payments at the rate of 1- 2%. While this may not sound significant, but when your company’s non-payroll vendor spend totals $8-10 million, duplicate payments may account for $80-10K worth of cash simply being leaked from your system every single year.

Besides specific checks for duplicate invoices, robust AP automation solutions can enable AP teams to detect any anomalies in spend and payments. AP teams can immediately identify if something isn't right by using trend analysis to see any spike in vendor spend or invoice count. Many errors or intentional vendor frauds happen for small value and one-time vendors who are challenging to recover from. Thus, double payments must be detected on time to reduce your spends. An AI account payable software should be equipped to give you sharp alerts to detect and eliminate vendor fraud or duplicate invoices immediately, helping you save at least 1% of your spend leakages.

Duplicate Invoices: What They Are, Why They Fail to Detect, and How to Avoid Them

Avoiding Duplicate Payments: A Common Challenge in Accounts Payable Processing

Duplicate payments are among the most common and costly challenges in accounts payable (AP) processing. With businesses under increasing pressure to streamline operations and maintain financial accuracy, resolving this issue is critical. According to the Institute of Finance and Management (IOFM), duplicate payments account for up to 2% of total supplier invoices processed annually, representing a significant financial risk for organizations

The solution to duplicate payments lies in a proactive, technology-first approach. Adopting embedded AP solutions ensures that invoices are processed with precision. Features like duplicate detection, invoice matching, and automated approvals reduce human error and improve accuracy. Routine internal audits can identify gaps in your process and flag duplicate payments early. Coupled with robust reporting tools, these audits provide actionable insights for continuous improvement.

Avoiding Duplicate Payments: A Common Challenge in Accounts Payable Processing | Expert Insights