Invoice scanning: Benefits, OCR technology, and how to automate it | Summit

Managing invoices is a critical task for finance teams. But handling them manually can be slow and full of mistakes. Incorrect data entry, lost invoices, and delayed approvals can cause payment issues, hurt supplier relationships, and create compliance risks.

This is where invoice scanning comes in. Instead of manually entering data from paper or PDF invoices, invoice scanning uses technology to automatically capture and process invoice details. This reduces errors, speeds up processing, and improves financial accuracy.

With automated invoice scanning, finance teams can focus on more strategic tasks instead of chasing down missing information. In this guide, we’ll explain how invoice scanning works, its benefits, and how it helps businesses simplify financial management.

What is invoice scanning and how does it work?

Invoice scanning is the process of converting paper or PDF invoices into digital data. Instead of manually typing invoice details, businesses can scan or upload invoices into a system that automatically extracts and processes the information. This makes the process faster and more accurate.

Here’s how invoice scanning works:

1. Capturing the invoice – Invoices can be scanned, uploaded, or imported directly from emails into the system.
2. Using OCR to extract data – The system uses Optical Character Recognition (OCR) to identify and extract key details like the invoice number, date, amount, and supplier name.
3. Validating the data – The extracted information is checked for accuracy. If any errors are found, the system flags them for review.
4. Matching with purchase orders and receipts – The invoice is matched against existing purchase orders and goods received notes to confirm that the details align.
5. Sending for approval and processing – Once verified, the invoice is sent for approval. After approval, the payment is processed according to the company’s payment terms.

What is OCR technology and how does it work?

OCR (Optical Character Recognition) is a technology that converts printed or handwritten text into digital data. It allows computers to read and understand text from scanned documents, PDFs, or images. In invoice scanning, OCR automates data extraction, reducing the need for manual data entry.

Here’s how OCR works in invoice scanning:

1. Recognising and extracting key fields – OCR identifies important details like the supplier name, invoice number, date, and total amount. It reads text, numbers, and even symbols from the document.
2. Identifying patterns and correcting formatting issues – OCR technology can recognise different invoice formats and adjust for issues like misaligned text or inconsistent fonts. It can also handle variations in currency, language, and numbering styles.
3. Validating data accuracy – Once the data is extracted, the system checks for errors or missing information. It flags any issues for review before sending the data to the finance system for approval and processing.

Benefits of invoice scanning

Invoice scanning offers several benefits that can significantly improve how businesses manage their finances. By automating the data capture process, it reduces manual work and increases efficiency. Here’s how it helps:

Reduces errors

Manual data entry is prone to mistakes like typos and incorrect amounts. Invoice scanning eliminates these errors by automatically capturing and validating data.

Speeds up processing

Automated invoice scanning processes invoices faster than manual methods. This reduces delays in approvals and payments, helping businesses avoid late fees.

Improves accuracy

OCR technology ensures that data is extracted correctly, reducing the chances of mismatched or duplicate invoices.

Enhances financial oversight

Real-time data from scanned invoices allows finance teams to monitor spending, track budgets, and identify discrepancies quickly.

Increases compliance

Scanned invoices create a clear digital record that is easy to access and audit. This helps businesses meet tax and regulatory requirements.

Saves costs

Automation reduces the need for manual processing, cutting down on labour costs and minimising processing fees.

How to automate invoice scanning with Summit

Summit’s automated invoice processing tool makes invoice scanning fast and seamless. First, Summit captures invoices from emails, PDFs, or scanned documents. Then, it uses OCR technology to extract and validate key details like supplier name, invoice number, and total amount. The system automatically matches the invoice with existing purchase orders and receipts to confirm accuracy. Once validated, the invoice is sent through Summit’s approval workflow. After approval, Summit schedules the payment and records it in the financial system. Summit integrates with existing accounting and ERP systems, ensuring smooth and accurate processing from start to finish.

Why automating invoice scanning matters

Automating invoice scanning improves financial accuracy and speeds up processing by reducing human error and manual workload. Finance teams no longer need to manually enter data or chase down missing details - OCR technology ensures that invoices are processed quickly and accurately. This enhances compliance by creating a clear, auditable record of all transactions. Automation also helps businesses avoid late payments and strengthens supplier relationships. For more details, explore our guide on optimising your invoicing process.

Ready to simplify your invoice processing? Talk to us today to see how Summit can help automate and improve your financial operations.