Examples of Reviewing Early Payment Discount Offers

This example shows how you can select the available early payment discount offers based on the invoice amount, the payment due date, number of accelerated days, and the annual percentage rate (APR).

Rates Based on AI Apps Information

You have three invoices for 10,000 USD that you want to pay on January 1. These invoices are eligible for early payment discounts. Each one of the invoices has either a different due date, annual percentage rate (APR), or both. You have deployed the AI Apps and presented with the data science driven targeted discount rates for all three invoices. The process has calculated the discounts for you based on your accepted APR, accelerated days (the number of days you plan to pay early), and provides you with the discount amount and payment amount. You can choose to accept, reject, or take no action on the discounts presented.

This table shows an example of the three invoices with the calculated sliding scale discount amount and the new payment amount. The calculation is based on the due date, days accelerated, and different APRs:

Invoice Number and Amount	Payment Date	Current Due Date	Days Accelerated	APR (%)	Calculated Discount Amount	New Payment Amount
1	01-Jan	08-Jan	7	18	35.00 USD	9,965.00 USD
2	01-Jan	08-Jan	7	24	46.67 USD	9,953.33 USD
3	01-Jan	15-Jan	14	24	93.33 USD	9,9606.67 USD

Points to Consider

1. Changing or overriding the payment term-based discount:

   • You are provided options for discounts based on when you want to pay the invoice.

   • You can either accept or reject the discounts provided. If the discount rate is accepted, the payment term-based discount is overridden. Although it's recommended to have a payment term without discount rates.

2. Changing a previously accepted discount rate:

   • You can revert the decision at any time after accepting the discount rate.

   • You can have 2 situations:

     1. If you haven't completed the payment, you can change the discount selection.

     2. If you have completed the payment, void it and create a new payment with the new rate.

3. Reviewing the discount offer:

   • If you don't initiate, or choose not to accept the discount offer, the invoice is paid according to the payment terms.

4. Dynamic discount:

   • A dynamic discount is a variable discount amount based on the days paid early, where the amount of the invoice discount decreases the closer the early payment comes to the payment term due date.

5. Changing the invoice process:

   • You don't need to change your invoicing process. The recommendation is to receive and process invoices in a timely fashion to provide more flexibility in payment timing and take advantage of available discounts.