There is no denying that storing a pile of receipts and manually extracting data from them to track a firm’s expenses, internal accounting, or prepare tax returns is no longer efficient by today’s standards.
According to the Beat The Receipt campaign group, 90% of the receipts are either lost, damaged, or thrown away. Now, if you as a business owner inaccurately estimate the expenses due to losing important receipts, cash flow and profit figures can be negatively impacted. In a worst-case scenario, your business could end up with a high amount of debt.
This is why all types of businesses, small, medium, and large, are all looking for solutions such as mobile receipt capturing to streamline their receipt processing.
In this blog, we will cover what mobile receipt data capture is, the technologies behind the solution, and the benefits for businesses using it.
What is mobile receipt capturing?
Mobile receipt capturing is, in essence, the process of extracting data from a receipt by scanning it with a mobile device such as a smartphone. In many instances, businesses need to be able to capture data remotely without being within the perimeter of an office or a scanner.
Mobile receipt capturing solutions are agile and allow businesses to streamline their receipt processing workflows even in remote locations. Such solutions often consist of Optical Character Recognition (OCR), which extracts data from images into a machine-readable format. Often OCR is embedded with Artificial Intelligence (AI) to automate the data capturing process.
Next, let’s take a closer look at these technologies.
Optical Character Recognition (OCR)
Optical Character Recognition (OCR) is a technology best known as a solution that turns images into text. Like human eyes, OCR can recognize letters, characters, words, lines, tables, phrases, patterns, and languages without a human’s physical limitations.
Some OCR software can achieve a data extraction accuracy of 99%. Often the extraction accuracy is directly dependent on the quality of the image uploaded to the OCR engine. With the image-preprocessing and post-processing of the OCR process, the images are enhanced with various techniques. Words are corrected by comparing them with the existing libraries of vocabulary.
In a mobile capturing solution, OCR extracts data on the receipt into a machine-readable format (JSON, XLM, etc.) and passes that on to Enterprise Resource Planning (ERP) or accounting systems.
Artificial Intelligence (AI)
Artificial Intelligence (AI) embedded into an OCR solution enables it to adapt over time and learn to recognize labels and data fields more accurately. In simple terms, it uses existing and new data to find correlations and use them to make predictions.
OCR alone is not enough to achieve a high data extraction accuracy of 99%. One of the main reasons for embedding it with AI is to make it as intelligent as humans to understand key insights with high speed and accuracy.
In a mobile receipt capturing solution, AI automates the receipt data extraction process and builds the knowledge pool of data. Data is then used to recognize a variety of receipts that can be recognized and processed. In essence, it makes use of data without too much human intervention.
But which data fields can the solution with such technologies capture?
Fields that can be captured from receipts
The data fields extracted from receipts depend highly on the mobile capturing solution providers. Some solutions are more advanced than others. However, most advanced solutions, in general, can extract the following data from receipts:
- Country of origin
- Type of document
- Document language
- Date of purchase
- Merchant name
- Details of the merchant
- Date of purchase
- Payment method
- VAT number
- VAT amounts
- Line items
- Prices, descriptions, and categories
- Currency
Of course, some solutions provide even more data fields than listed here. It is essential to consider which fields are the most important for you when choosing a mobile data capture solution provider.
The same goes for the benefits. Let’s take a look at the most common ones.
The benefits of mobile receipt capturing
Many businesses from various industries choose to use mobile receipt capturing because it brings a wide range of benefits. These benefits include:
- Faster turnaround time
- Scalability
- Digitization of receipts
- Minimization of human error
- Cost reduction
- Enhanced employee engagement
Faster turnaround time
An AI-powered mobile receipt capturing solution can extract data from receipts within seconds. Businesses can significantly speed up their turnaround time of receipt processing. Automating the process can reduce up to 70% of the time spent. Faster turnaround time often has a positive impact on overhead costs.
Scalability
Adding data capture software to a mobile phone to extract data from receipts is definitely more scalable than adding staff to your team. It is far too expensive to dedicate more staff time to manually process receipts as the volume grows.
Digitization of receipts
With a mobile capturing solution, it is no longer necessary to store receipts or scan them in the office for further processing such as expense management or internal accounting. Receipts can be stored and organized digitally once images are taken with the solution. No more risks of losing receipts or carrying damaged ones back to the office.
Minimization of human error
Manual data capture, which often involves data entry, is a task that is prone to human error. Mistakes that happen when entering data into accounting or an ERP system can cost businesses a lot of money. With mobile data capturing solutions, these mistakes can be minimized. An AI-powered OCR engine is able to complete tasks without getting tired like humans.
Cost reduction
With the faster turnaround time, digitization, and minimization of human errors, operational costs are reduced significantly. No more running costs, resource wastage, or opportunity costs resulting from inaccurate data. Intelligent Automation solutions such as mobile receipt capture can reduce costs by 40-70% according to Forbes.
Enhanced employee engagement
Streamlined receipt processing with mobile data capture eliminates the need to manually engage in repetitive and dreadful tasks such as manual data entry. Employees who no longer need to dedicate their time to such tasks enjoy contributing to more meaningful projects. This in return enhances employee engagement, which results in higher productivity.
Higher efficiency beyond the traditional approach
Digitizing your receipts with mobile receipt capturing not only removes the hassle of organizing and storing records of receipts, but also smoothens your business operations. With mobile receipt capturing, your business can process thousands of receipts with a speed that cannot be achieved without cutting-edge technologies. This enables your organization to be efficient beyond traditional methods.
Founded in 2015, Klippa’s goal is to digitize & automate administrative processes with modern technologies. We help clients enhance the effectiveness of their organization by using machine learning and OCR. Since 2015, more than a thousand happy clients have used Klippa’s software solutions. Klippa currently has an international team of 50 people, with offices in Groningen, Amsterdam and Brasov.
