CPD Accredited Webinar: Expert Strategies for Surviving Your Accounts Payable Audit - Thursday 25th April - 2:00 PM (GMT) l 9:00 AM (ET)

Managing and Preventing Duplicate Payments: Ultimate Guide

Discover how to make preventing duplicate payments efficient and cost-effective.

The Ultimate Guide to Preventing and Detecting Duplicate Payments

Payables managers tell us constantly that errors and duplicates are a key concern. In fact, in the PPN survey 2023, 29% of participants said that duplicate payments are a main operational difficulty in accounts payable.

This definitive guide is designed to help you understand how and why duplicate payments happen, with advice on detecting them and preventing them from happening.

Key benefits:

Prevent overpayment with error and duplicate detection.

Identify and prevent potential internal and external fraud

Reconcile more supplier statements more often to recover more cash

Optimise working capital by finding historical overpayments

Customer success stories
& testimonials.

Read our blog

You see what nobody else sees

Table of Contents

What is a duplicate payment?

Sometimes known as a double payment, a duplicate payment in accounts payable is when an organisation pays a supplier/vendor twice for the same invoice and therefore the same services or goods. It is most commonly due to a duplicate invoice, but there are several reasons why they occur.

Why is finding duplicate invoices important for Accounts Payable?

According to research by The Institute of Finance and Management (IOFM), around 1.5% of an organisation’s total outgoing cash flow is actually duplicate payments.

With this figure in mind, it’s easy to see how duplicate payments can affect a business and create risks:

Working capital is decreased and/or used inefficiently.

This could mean the difference between being able to pay all your expenses, or not. At best it can be caught early, but it may not be entirely recoverable and –

It disrupts your daily accounts payable tasks.

Time-consuming and costly recoveries need to take place instead of other important tasks – like making payments! This can put pressure on your relationship with the vendor and even prevent your organisation from being able to access preferential terms or lines of credit.

It harms your reporting accuracy.

And makes it appear that you have spent more than you have. This can also have a wider impact on your financial planning and management as your data is less representative of your actual position and can leave you open to fraud.

Our blog goes into more detail about the risks of finding duplicate payments and invoices to your organisation.

The powerful benefits of finding duplicate payments.

There are huge benefits that arise from finding your duplicate invoices:
You prevent overspending… and therefore optimise working capital.
Avoid the payment recovery process… and save time.
Prevent fraudulent invoices from being paid… and avoid the associated losses.

Why do duplicate payments happen?

The reasons for duplicate payments are many; accidental and deliberate. The root cause can be as simple as a system error, non-compliance to process, or fatigued staff. To manage and prevent duplicate payments, you need to prioritise carefully. We’ve categorised causes into three groups to make it easier. To eradicate your duplicate payments, you’ll need to focus on all three:

  • Fraud and payment scams, either from internal sources, malicious actors, or the supplier themselves.
  • Inputting errors. If an invoice is inputted manually at any point in the process, including by your vendors, you can be at risk of human error.
  • Fatigue, we’re all human, and sometimes we make mistakes. Understand your process and its impact on your staff. 
  • Lack of oversight in the P2P process. Inefficient invoice management systems with lack of oversight can lead to unintentional duplicates. Verification processes can be tiresome and time-consuming, and your team may inadvertently miss errors or double invoices, especially if you are reliant on manual checks.
  • Insecure payment options, like cheques which can easily be lost or duplicated.
  • Invoices sent both physically and digitally, making it difficult to follow paper trails.
  • Data input and management – How fast is information entered into your ERP? If your AP department is ahead or behind your other departments, then it can become out of sync and problems can occur.
  • Lack of a centralised system for invoices and payments, with multiple data entry points is confusing. This lack of standardisation makes you reliant on your process and staff properly following procedure. If they don’t, duplicates can occur.
  • Syncing issues between your systems. Software malfunctions or technical issues can sometimes cause duplicate invoices and therefore double payment. This can also happen if your system isn’t synced properly and a large time gap ensues. An individual may enter the invoice manually thinking it hasn’t been picked up, only for it to appear once the system updates.
  • Invoices in different formats confuse ERP systems. Data extraction tools and OCR can be hit or miss, and if an invoice is formatted differently from what it expects, it can be interpreted incorrectly.

To discover why duplicate payments happen in more detail, read our blog:

Ready to transform your duplicate detection?

We’d love to show you our solution in action – book a demo today.

How do you effectively handle duplicate payments?

Each accounts payable team will have their own process when it comes to handling duplicate payments. This is dependent on your team, the departmental structure, and the systems you have in place. If in doubt, speak to your manager.

Generally, it is handled in the following way:

  1. Discover the error. You can find duplicate payments via regular supplier statement reconciliation or spot checks or vendor notifications, or via automated risk analysis software such as FISCAL Technologies’.
  2. Where possible, amend your system and notify internal stakeholders before a payment run occurs.
  3. If the payment has already been made, notify the supplier, and request a refund or credit.
  4. Recover cash or receive a credit note.
  5. Document the refund or credit transaction.
  6. Investigate the root cause of the duplicate and take measures to prevent this issue.

In our blog, we go into further detail about how to manage a duplicate payment, and what we can do to help.

How to detect and prevent duplicate payments

Finding and recovering duplicate payments in accounts payable can be a difficult feat, especially if your team are exceptionally busy and don’t have time to make regular checks. However, with the following controls, you should be able to reduce or mitigate your duplicate payment risk level substantially:

  1. Validate your supplier data regularly, ensure payment details are fully up to date, and remove duplicated vendors from your master file. 
  2. Conduct regular internal audits and checks on your transactions before the payment run.
  3. 3-way matching. Do be wary that although 3-way matching can find duplicates, it can also miss them entirely (link to 3-way matching blog)
  4. Use automated duplicate payment detection software, like ours.
  5. Create more effective oversight with in-depth reporting.

And remember – it’s as important to check for duplicates after payments have been made as it is before. We recommend reconciling your supplier statements regularly to find historical overpayments.

How to prevent duplicate invoices

Often, the root cause of a double payment is a duplicate invoice. Alongside the inspections you make before payment, you should scrutinise your full P2P process to rectify these issues, and where possible, implement the following:

  1. Streamline and centralise receiving invoices with a singular entry point like a dedicated email inbox or supplier portal.
  2. Automate your processes where possible to remove human errors.
  3. Standardise invoices so they have the same format and structure, making it easier for your systems to understand.
  4. Limit your payment methods to electronic means to track them better.
  5. Create oversight and visibility by using collaborative software to check for duplication and/or errors.
  6. Reduce supplier complexity to make it easier to spot errors. Cleanse your master supplier/vendor file and limit the number of vendors you work with.
  7. Pay invoices promptly, which prevents duplicates arising from suppliers resending an unpaid invoice.
  8. Establish a standard workflow and provide training for your team.

Even when you have robust controls and the correct processes in place, some duplicates can slip through your carefully crafted nets. To ensure you catch everything, we recommend that you use duplicate invoice detection software.

FISCAL Duplicate Payment Detection and Prevention Software.

Last year alone, we prevented £250 million in duplicate payments from leaving our customers’ accounts.

Our duplicate payment prevention software analyses your transactions using a combination of AI and forensic-level tests, to find high-risk invoices that could be duplicates. It creates a prioritised list of every risk, showing all the relevant information staff need to investigate potential duplications. Staff are then able to investigate and act before the payment run, therefore preventing overpayments and protecting working capital before it ever leaves the business.

Laptop showing our transactional risk management software and it's capabilities to find risks including duplicate payments and fraud, to enable working capital optimisation

Testimonials & Case Studies

Allscripts: Case Study

Discover how Allscripts reduced errors and overpayments, whilst also reducing their risk exposure and wasted processing time by using FISCAL Technologies.

NHS Brighton and Sussex University Hospitals: Case Study

Brighton and Sussex University Hospitals were processing over 140,000 supplier invoices per annum, within 5 months, over £50,000 of duplicate payments were flagged and avoided with FISCAL’s solution!

University of Portsmouth: Case Study

Find out how the University of Portsmouth achieved ROI of over 500%, by recovering and preventing duplicate payments.

London & Quadrant: Case Study

With a small Accounts Payable team, London & Quadrant recognised they had no time to waste when it came to processing invoices or chasing duplicate payments. Since launch, FISCAL’s solutions

Want to know more about FISCAL Technologies?

We’d love to show you our solutions in action!