Modulr has announced an enhanced integration with Xero that will support payroll payments to employees. The Modulr payments platform enables organisations to automate the end-to-end payment cycle in four steps.
- Synchronise invoice, and now payroll data, between Xero and Modulr
- Obtain approval for the requested payments using several methods, including the Modulr mobile applications
- Pay automatically on the scheduled date
- Reconcile payment data back into the accounting system, such as Xero
The new enhancement will enable Xero users to synchronise their payroll data, either in a batch, for a monthly payment run or one-off payments. The automated process ensures that there is less manual re-entry and reduces the risk of errors. It also means the process is completed faster with less administration time. Modulr estimates that it will cut payroll payment processing time by up to 80%. Firms are also able to consolidate payments to multiple employees and schedule payment runs to enhance cash flow, thereby reducing fees and costs.
The integration enables Xero Payroll users to leverage the Modulr real-time payments network. The network supports faster payments, with some payments clearing within 90 seconds, even during weekends and holidays.
Williams Stanley & Co., a business accounting firm services that works with hundreds of clients using the integration. It helps manage the process of making payments to employees and suppliers. James Couch, Director at Williams Stanley & Co, commented, “If we take on a new client at WS, they have to use Modulr. It’s a non-negotiable. We save 10 minutes per pay cycle, and when we’ve got 600 clients doing weekly pay runs and payroll, that’s a huge amount of time.”
Why is this important
Research by Caxton and published in the Global Payroll Association (GPA) in 2023, found that 47% of UK employees have been paid late or incorrectly. It can have a huge impact on organisations. 1 in 10 employees leave a firm because of late payroll payments. There is also a huge mental impact of being paid late, with 35% of employees feeling stressed as a result. The issue also damages the psychological contract between the employee and employer.
In addition, when a payroll fails, the finance team often needs to pick up the pieces by manually issuing payments or even writing cheques. The additional manual overhead risks further errors and increases the costs of the initial failure. MHR estimates that UK businesses lose at least £150,000 a year through payroll errors. An EY white paper indicates that each error costs about $291 to remedy, either directly or indirectly.
Making a difference to payroll
This latest integration streamlines the process between Xero Payroll and Modulr. Kerry Wale, Senior Client Manager at Women Who Count, who specialise in bookkeeping, payroll and accountancy, is using the solution, noted, “Thanks to the Modulr and Xero integration, we can efficiently set up payments in advance or immediately for payroll without needing access to clients’ online banking. And with real-time payments, we no longer worry about the inflexible three working day lead time of traditional Bacs payments. Overall, this new integration allows us to deliver an end-to-end payroll process, with smooth onboarding and excellent support from the Modulr team.”
Steve Bradford, Managing Director of Channel and Strategic Partnerships at Modulr, said, “When it comes to payroll, its people’s livelihoods and the business’ reputation that are at stake. Payroll bureaus, accountants and businesses have enough to deal with without having to worry about unnecessary errors due to outdated systems.”
“This latest addition to our integration with Xero is another step in expanding our eco-system and broadening the options payroll professionals have in optimising their processes. And through our industry-first mobile app, payroll and business leaders can benefit from smart, fast and secure approvals on the go.”
For Modulr, this is another payroll solution it integrates with. It has several integrations to help firms to automate their payroll processes.
Modulr is the payments partner of choice for leading accounting and payroll software providers, including Xero, Sage, IRIS and BrightPay, and is already trusted by thousands of accountants, payroll bureaus and businesses to streamline payroll and invoice payment processes. These include:
Enterprise Times: What does this mean
This is good news for Xero Payroll users. Anything that helps them reduce the risks associated with administrating a payroll function is welcome. The ability for the finance team to authorise payment from a mobile device also ensures that the process can be completed with minimal delays, ensuring that payments are made on time.
The Payroll function is one of the most important elements within any organisation. If it fails to function in a given month, the risk to the organisation is huge. If errors are made, it can have a serious impact on employee retention. Reducing the risk to the payroll process and automating, with the right checks in place is valuable. For Xero Payroll users, this integration is something that finance teams should, therefore, consider.
