Top solutions increase touchless transactions, enabling finance teams to reallocate staff (63%), lower costs (43%) and boost working capital ($15M)
The Hackett Group, Inc. (NASDAQ: HCKT), a leading generative artificial intelligence (Gen AI) consultancy and executive advisory firm, has released its latest Digital World Class® Matrix, focusing on the cash application software marketplace. The report reveals leading vendor capabilities in the space and examines the critical relationship between AI-powered touchless invoice-level payment matching and improved cash flow.
Cash application process software can deliver rewards in terms of both cost and cash, with cash flow and working capital being significantly highlighted. In The Hackett Group’s 2025 Finance Key Issues Study published earlier this year, optimizing cash flow performance has become the No. 1 chief financial officer (CFO) priority. Automating the cash application process has a transformational impact on finance organizations struggling with low transaction match rates. It enables a 63% reallocation of staff and a 43% decrease in process cost across receivables management functions, including cash application, collections, and dispute management – critical efficiencies as finance leaders continue to be challenged to do more with less. Congruently, these leaders are also being tasked with delivering critical operating cash flow to the business. Our analysis highlights the correlation of increased cash application match rates with the ability to liberate up to $15M in unapplied cash to business operations. These factors create a compelling business case for investing in modern cash application software.
The Cash Application Software Digital World Class® Matrix provides a guide to the leading software vendors and their impact on companies’ customer-to-cash processes. These tools accurately match customer payments and remittance advice with open invoices, automatically account for short payments, generate workflow for unearned deductions, and accelerate the availability of operating cash. The report evaluated 15 vendors that offer cash application software for their capabilities and the value delivered to clients based on vendor briefings and customer data input across 16 different criteria.
Capability ratings assess a vendor’s capacity to integrate with enterprise resource planning (ERP) systems, receivables management tools, banks, and payment portals to intelligently capture data and match payments with open invoices. They also evaluate whether the solution delivers this functionality through an intuitive, user-friendly interface, and provides real-time performance dashboards.
Value realization ratings measure vendors’ impact on key cash application process performance metrics such as the touchless automated match rate, remittance-less match rates, application cycle times and the reduction of unapplied cash. Among end users assessed, the median auto-match rate is 70% with a third of end users achieving match rates exceeding 80%, 61% are matching payments on the same day they are received, and 51% of end users indicated their software is delivering remittance-less match rates for up to 60% of their cash application volume. User adoption and overall satisfaction with the software were both exceptionally high at 91%.
All vendors have predictive AI and machine learning functionality in their platforms, and that technology continues to mature. Gen AI is being developed and deployed to specifically address the challenges of short payments and unearned deductions. Gen AI is initiating the necessary internal and external communications related to unearned deductions and supporting resolution workflows.
“With improvement of cash flow and working capital being the top priority for CFOs, every process that involves cash must be evaluated and optimized,” said Bryan DeGraw, associate principal and senior research director for Finance Market Intelligence at The Hackett Group®. “A surprising number of organizations are accepting automation rates below 40%, taking up to three days to post payments, and carrying up to 6% of unapplied cash. This lack of competitive performance in a back-office process like cash application can significantly impact an organization’s ability to be agile and compete in its respective markets. The cash flow benefits of AI-powered cash application software can be quickly realized through average implementations of three to six months. Immediate benefits can evolve to significant long-term cost savings and improved cash flow for organizations growing organically or through acquisitions.”
By using this comprehensive analysis, professionals and leaders in finance and global business services can make informed purchasing decisions aligned with their strategic priorities and critical performance metrics through improved process cost, cash flow, and customer experience.
Cash Application Software Digital World Class® assessments are part of The Hackett Group’s full 62-page report. The assessments should be read in the context of the entire report. Download a complimentary summary of the cash application software research with registration. Contact us for inquiries about purchasing the full research report.
The Hackett Group® does not endorse any participant, vendor, product or service depicted in its research. This research should not be considered as advice that a buyer select only those participants based on their ranking or position on The Hackett Group’s Digital World Class® Matrix. You should not rely upon any material or information within this research as a basis for making any business, legal, financial or any other decisions. Any such reliance shall be solely at buyer’s risk. The Hackett Group research publications consist of the opinions of its research organization and should not be interpreted as factual statements. To the fullest extent permitted by law, The Hackett Group® disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability, suitability or fitness for a particular purpose. The information contained in this research is provided on an “as-is” basis with no guarantees of completeness, accuracy, usefulness or timeliness. The Hackett Group® assumes no responsibility or liability for damages of any kind arising from any information, data, content, materials, or references within its research, including but not limited to direct, indirect, incidental, consequential, special, and punitive damages.
About The Hackett Group®
The Hackett Group, Inc. (NASDAQ: HCKT) is an IP and platform-based, Gen AI strategic consulting and executive advisory firm that enables Digital World Class® performance. Using AI XPLR™ and ZBrain™ – our ideation through implementation platforms – our experienced professionals help organizations realize the power of Gen AI and achieve quantifiable, breakthrough results, allowing us to be key architects of their Gen AI journey.
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Our analysis highlights the correlation of increased cash application match rates with the ability to liberate up to $15M in unapplied cash to business operations. These factors create a compelling business case for investing in cash application software.
