AP at a Breaking Point: What 2026 Will Demand

The Payments Podcast by Bottomline

Episode Transcript

Owen McDonald (host): Welcome to The Payments Podcast. I'm your host, Bottomline Managing Editor Owen McDonald. Spring is springing in North America. Among other things, that means it's time for the spring conference of the Institute of Finance and Management, also known as the IOFM. AP and finance leaders are gathering at the event this year to discuss major issues, including AI, fraud, and procure-to-pay.

There is no better guest to navigate that mix than Mark Brousseau, President of Brousseau and Associates and a longtime IOFM subject matter expert. He's right here. Mark Brousseau, welcome back to The Payments Podcast.

Mark Brousseau (guest): Thanks so much for having me, Owen.

Owen McDonald (host): AI is finally getting operational, and more CEOs are asking about things like ROI, for example. So the hype cycle is pretty much done with, at least for now. If that's the mood, Mark, I'm wondering where AP teams are finding quick wins with AI versus being stuck in pilot mode as many still are. What are your thoughts?

Mark Brousseau (guest): I recently saw a study, Owen, that showed that 57% of AP departments are currently using artificial intelligence in some way in their department. Now only 5% of all of those AP departments that were surveyed are actually using a so called end-to-end AI powered AP automation solution. The rest are doing pilots or they're using AI in very targeted functions, and in many cases, that targeted way that AP departments are using AI is for data capture. We know, Owen, that optical character recognition, which was probably one of the last hot technologies to come through finance, really never lived up to its hype cycle.

And so, AP departments are looking for ways to use AI to help make up for those shortcomings. And it makes perfect sense. Right? AI uses natural language processing and other tools to contextually read documents and be able to capture not only header, but line item data in ways that OCR could never dream of doing.

That's really good news for AP departments. It's providing a quick win, and it's getting everybody confident in the technology. Here's the thing. We want to make sure that we're thinking the long term here. So, we want to look beyond just data capture.

And there's a few things that I'm hearing AP leaders saying they're considering using AI for. Number one is to use AI to interrogate their email boxes to basically discern which emails are invoices, which are POs, which might be a supplier onboarding packet, and then send them on their way for processing. In other cases, folks are looking to use AI to help with general ledger coding, which is, in many cases, the bane of a finance leader's existence. Other folks are looking at AI to automatically route invoices for approval. And then, as we'll talk about a little bit later during our conversation today, many AP leaders are excited about the opportunity to use AI to be able to look at their payments and invoices to be able to detect anomalies that might indicate fraud.

Here's the key thing, with all technologies, we're in a growth cycle here. Right? So we're just at the bottom of that hockey stick.

Owen McDonald (host): Sure.

Mark Brousseau (guest): And so, what you want to do as an AP leader is make sure you think not just about your current needs, but also your long term needs. So, take a hard look at your department and try to assess where some of those gaps and friction points are to identify those use cases for AI, not just now, but into the future. You also wanna make sure that when you're evaluating technologies, you find one that isn't just another point solution. The last thing AP departments need is another poorly integrated solution that doesn't talk well with other systems.

You want to make sure that you do have at least a platform for expanding into other functional areas. And finally, you want to make sure that you're looking at technologies that can scale with your business as many AP leaders are still struggling with a pretty difficult labor market and, of course, constant pressure to reduce costs, you've got to make sure that you have a solution that's scalable. The good news here, Owen, is that AI isn't coming. It's already here, and there are some opportunities for AP leaders to be able to get a pretty strong ROI from the technology.

Owen McDonald: I would agree. I would say you just gave them a bunch. You also mentioned fraud in there, and fraud is no longer a matter of applying controls. There are so many different fraud vectors and attack surfaces now. So, how do you see AI powered impersonation, deep fakes, vendor change scams shifting the AP risk model, Mark?

Mark Brousseau (guest): As if AP leaders didn't have enough waiting on their shoulders, Owen, today they are competing against well -financed, very sophisticated fraudsters who are determined to rip AP departments off. I recently read an article, Owen, about one fraud ring that was broken up. It turned out they had 500 individuals associated with the fraud ring. They had an HR department, Owen, to recruit their fraudsters, and they even had, get this, a marketing department to try to sell their ill gotten data.

Come on now. And on top of all this, Owen, it turns out that the ring was financed by a rogue Eastern European nation. Now, for an AP leader who's managing a team of five or 10 individuals and has a lot on their plate today, this could seem really daunting. But the good news is that there are some steps that AP leaders can take to stop fraudsters in their tracks. And in many cases, it's leveraging the same technology, AI, that the fraudsters are using against them.

The first thing they should do, Owen, is to centralize the intake of bank account change requests. We know that one of the fastest growing forms of fraud in accounts payable today is phony bank account change requests. And one of the problems is they come into the organization in a myriad of ways. So, depending on who receives those requests, it might go a long way to determining how well they're handled.

Well, let's stop that. Let's get them all into one place so that we can be sure that they're handled in a consistent manner. That brings us to step two, to standardize the way that we handle bank account change requests as well as the verification of any supplier data. We want to apply systematic workflows to verifying all of that data to ensure that it's being handled correctly. 

Look, Owen, every AP department has policies and procedures in place for how it is that things should be handled. The problem is that people have a bad day. They might be new to the job. They might not be familiar with all the policies and procedures. They might not think it's their job to do whatever task we're counting on them to do, right? To catch the fraud. 

We've got to take this out of their hands. We've got to find ways to systematically apply these workflows so that things like bank account change requests are handled consistently every single time, no matter what. And that brings us to the third thing AP leaders should do, and that is automate the verification process. Whether it's validating TIN numbers, doing OFAC checking, sanction screening, or, yes, for this conversation, bank account validation, automation helps.

We should always be using third party sources to validate that data. The problem is is most of the ways that we currently go about validating bank account information was built for a day and time when we could trust the person on the other side. Right? You could hit reply on an email and be pretty sure that it was the supplier on the other end or pick up a phone and be sure it was a supplier on the other end and not an AI-generated voice simulation of them. Well, those days are long gone, and so now we need to use automation to be able to check.

Does the name on the bank account match the name of the supplier we think we're paying? Does the TIN on that bank account match the TIN that's in my ERP for that supplier? Is that bank account located in a place that makes sense for where the supplier is located? So in other words, why should I be making a payment to a bank account in Asia if the supplier is in Peoria, Illinois? And finally, is that account open? 

And that brings us to our fourth thing AP leaders should do when it comes to to to mitigating the risk of fraud, and that is don't treat every transaction equally because they're not. So, we might have new suppliers. We might have strategic suppliers. We might have high dollar transactions.

We might have suppliers with bank accounts that, well, recently changed. And what we want to do is make sure we have tools to automatically flag those accounts that probably require a little closer scrutiny. Remember, we're going to use AI to eliminate a lot of manual tasks in our operation. That's going to free up time to be able to spend more time on those exceptions or cases where we need closer scrutiny. And the final thing we can do as AP leaders to mitigate our risk of fraud, Owen, is to tell our team that it's okay to say no.

What we find, Owen, is that a lot of these fraud schemes are built around a sense of urgency. Right? We've all seen these, emails or texts or even calls. Hey, we've got to change this bank account right now, or our entire supply chain comes to a halt.

And in many cases, those requests come from either a strategic supplier or worse yet, the boss, a CFO. And fraudsters know this. Fraudsters know that AP people are people pleasers. We want to do things that make other people in our organization happy or our suppliers happy. 

The problem is that's exactly what fraudsters are counting on. They're counting on you saying, oh, yes. I'll get this done right away, and not do the proper validations. So we want to empower our team to be able to say, hold on. I've got to do the process, and then we'll put this payment through.

If you use all of those strategies, that levels the playing field even against the most sophisticated AI armed fraudsters, Owen.

Owen McDonald (host): Fair enough. Although, this next question, you just made me feel even worse about asking it because when we recently chatted, we talked about how the AP leader's job is expanding. The AP leader of 2026 is now part operator, part technologist, part risk manager, part internal evangelist. I mean, you just gave us a real good sense of things, Mark, but how about it? Can AP leaders do it all, and how can they do it all?

Mark Brousseau (guest): AP leaders are working longer hours these days than ever. This started during the pandemic, and many assume that once we moved back into our office, at least most of the time, that things would return to normal. The problem is that hasn't been the case. My friends at IOFM did a study recently and found that about a quarter of all AP practitioners are working an additional two hours per day. Now think about that for a moment, Owen.

A typical eight hour day, that means you're working an extra 25%. Who has the time for that? We're juggling our home, our family, we're trying to get ahead in our career and maintain some sort of a social life, right?

This is a big problem. Here's the issue though, Owen, is that the business is counting on AP to do it all. This goes back to the shifting role of CFOs. Right? Today, about three quarters of all CFOs say that one of their primary responsibilities is uncovering sources of value and helping the organization grow.

Who do you think they're going to go to to help them get at the data they need to do all that? AP. So now, we've already discussed the fact that we're using AI to help drive operational performance. So, as you said, AP leaders need to be tacticians. We already talked about the fact we need AP leaders to to to be to be the company's first line of defense against fraud.

They need to be our defenders, and now we're asking them to be strategists as well. Here's the good news, Owen, is that we're hearing from AP leaders that they're being called into more strategic meetings. And this is great, not just for the profession, but also for the professionals. Right? Because now they're going to have an opportunity to grow and to shine and to become that information hub to the business that I think they were always meant to be.

My advice to AP leaders is this. Number one, leverage automation wherever possible to try to eliminate those manual tasks that will keep you from focusing on the strategic tasks that will help you, your department, and your business grow. Today, the typical AP manager spends more time each day on transaction processing, Owen, than they do on managerial tasks that they were hired to perform. Things like career development or hiring or strategy. We've got to stop that.

If you talk to a CFO and you ask them, what do you want your AP manager focused on? It'd be the exact opposite thing, as you said. The second thing we need AP leaders to do is to leverage the data in their department, wherever possible, to start positioning their department as an information hub. Right? We're sitting on a treasure trove of information that gives us insights into things like cash, positioning and spend management.

This is what a business needs, particularly at uncertain economic times like these. But the key is is we've got to unlock that. And the third thing we need to do is to raise our hand. AP leaders have tremendous value to offer the business, and I know that with everything else you have on your plate every day, the last thing you want to do is say, give me more. But this is important for your career, for your department, and for your business.

Use the skills you have and say, I can add value to these discussions. The role of AP leaders is going to continue to change. I think if anything, it's going to accelerate as AI continues to become more widely spread, Owen. It's now the challenge of AP leaders to seize this opportunity.

Owen McDonald (host): Let's hope they do. Now, a couple of things you just said sort of segue nicely into this question. Payment security, onboarding, and data quality are converging, you might say. Do you think the next big gains AP makes will come less from things like invoice capture, as you were mentioning earlier, and more from tightening the procure-to-pay process in particular?

Mark Brousseau (guest): You betcha. So what's going to happen here is we are going to see a mind shift. For years, AP used to look at automation as a piecemeal solution. I want to stop keying this invoice data. Let's put in an OCR solution.

Our approvals are taking too long. Let's drop in a workflow solution. In many cases, there were multiple point solutions from multiple vendors that were loosely or poorly integrated. What we're seeing now is that organizations recognize that if they could think holistically about the AP function, that invoice-to-pay or procure-to-pay function, now they could drive real sustainable change.

So, we're seeing more organizations think about things like how can we more tightly integrate supplier onboarding with invoice management, and what data from our invoices will help us make better decisions about how to optimize our payments, and how can we better manage supplier management with information that we glean from our invoices. When we think holistically about the invoice-to-pay process, then we can drive some real improvements in terms of cost takeout, elimination of errors, and, acceleration of cycles. Here's the thing, Owen, is organizations need to think differently when they're making buying solutions. Now I'm not going to tell you that you need to buy this monolithic system from one vendor and to play it all at once. Big bangs are great for universe building, not so hot for automating AP.

But what I do want AP leaders to do is the next time they're evaluating a solution, think about how it would fit into a holistic procure-to-pay automation strategy. Does that vendor have capabilities across the procure-to-pay life cycle? You don't have to turn them on all at once, but just make sure you don't get stuck again with a point solution that's going to require you to do some gymnastics to make data flow more smoothly through your department.

Owen McDonald (host): Fair enough. Last question, Mark. As you think about this May 2026 IOFM conference and you talk with people in payments, we're going to do a little gambling exercise. Where would you place your chips, so to speak, in the next twelve to eighteen months? You get three choices, investing more money in AI, tightening onboarding and fraud controls, or redesigning procure-to-pay so that AP plays a more strategic role.

What will you go with, and please explain your choice.

Mark Brousseau (guest): I'm pushing all of my chips over to redesigning the AP function, and here's the reason why. This is an easy question. Fact is that AI and fraud mitigation are all part of that redesigning effort. We're going to see a sea change over the next 12 to 24 months where organizations are going to recognize that AP can be a strategic powerhouse for the business, and they're going to use tools like AI to help drive that change.

They're going to rethink their controls that they're using. They're going to leverage their data in ways they've never done it before. And the reason they're going to do this is because they have to. We can't let AP continue to be this tactical back office function that's a drain on corporate resources and a cost to doing business. There's too much riding on AP.

Take the tariff discussion from just a few months ago. Right? Businesses once again were forced to to take a hard look at who they were doing business with, what they would do if that supplier wasn't there, how much they were spending with that supplier. Where does that data reside? In AP.

Think about the changes in interest rates that we've been seeing over the past several months. This is requiring businesses to to shift the way that they're managing their working capital. Where are they going to go for that data? It's going to be in AP. 

We're seeing this big discussion around fraud. CFOs have now set it as their number three priority right behind liquidity analysis and cash flow forecasting, and it's something that's keeping them up at night. Who are they going to count on to help mitigate their business's risk? It's going to be AP. So AP leaders are sitting at this inflection point where we're going to have to make a decision. Are we up to the task of what business is going to require of us, or are we going to stick in our ways and continue to do these transaction processing? And if so, are we willing to risk being passed by or maybe passed over by our business? 

So I think that over the next year or two, Owen, we're going to see a big change in the way that not just AP leaders view their function, but the way that their business views their function. And this is going to be a new era for AP that's going to be very exciting for all of us.

Owen McDonald (host): And there you have it. Accounts payable is achieving its strategic aspirations. It is now far more technology driven and absolutely central to risk and process performance. Accordingly, the future of finance ops will be defined by how well AP leaders connect AI, fraud controls, and payments into one smarter operating model. A huge thanks to a great guest, Mark Brousseau of the IOFM.

To our audience, the smartest people in B2B payments, thanks for listening. Hit subscribe. Catch us again on your favorite podcast platforms, including Apple, Spotify, Blubrry , iHeartRadio, and YouTube. Bye for now.

The Payments Podcast from Bottomline.