Many companies struggle with employee expense management, especially per diem allowance. As much as it is important for businesses to efficiently manage costs, most of them are still stuck to Excel or logbooks. And, once a company starts scaling and more employees start traveling for business, it will become a nightmare to monitor employee expense reimbursement and manage per diem rates.
But with the advancement of technology, the market has seen new-age platforms that help businesses with employee expenses. Some of these platforms rely on artificial intelligence (AI) and machine learning (ML) to provide companies with a seamless experience with expense management processes.
By shifting to AI-powered employee expense reimbursement solutions, your team can focus on managing critical tasks by ensuring cash flow health instead of worrying about per diem allowances.
But how exactly does AI/ML help manage employee expense reimbursements and usher companies into the new age of automating per diem allowances?
Manual expense management – What is broken?
If you have your finance team manually look at every employee expense reimbursement claim, they will end up spending the majority of their time-
- Going through expense receipts
- Entering data into Excel sheets
- Doing back-and-forth with employees on missing information
- Bring data from multiple systems into one place
- getting signatures for approvals
- Handling reimbursements
Not only is this process tiresome, rigid, and outdated – for both the finance team and traveling employees, it leads to errors and fraud. Although companies switched to per diem allowances to reduce the hassle, it has done very little to help manual expense management.
Per diem allowance – What is it exactly?
Derived from Latin, per diem literally means ‘for each day’, and per diem allowance refers to the amount that companies give their traveling employees in advance to take care of their expenses. The allowance covers all the expenses like meals, hotel bookings, laundry service, and so on. It quickly caught on with companies because-
- It eliminates the necessity of keeping track of every expense receipt
- It reduces the involvement of admin in managing business trip expenses
- It improves compliance and allows easy tax reporting
AI/ML and per diem allowance – How does it work?
Managing travel and employee expenses is the second most difficult category for companies, as per Forrester’s research. This is hardly a surprise when you look at the fact that 80% of them do not use an automated platform. This critical challenge is being solved with gen-next technology platforms that come with AI/Ml capability to identify patterns, predict expense costs, reconcile data from multiple locations, and eliminate duplication or fraud.
With an advanced platform, your admin or finance team can set per diem allowance rates. Your employees, on the other hand, need to enter their trip details like travel dates, destination, discounts or free meal details, and so on. Through an ML-based algorithm, it will calculate the per diem amount that needs to be reimbursed. After the concerned manager approves it, the amount is directly debited into the employee’s account.
Hassle-free employee expense reimbursement
An automated expense platform eliminates the complexity involved in employee expense reimbursement. Your employee can submit a per diem request through the portal and post manager’s approval, the employee will be reimbursed.
Seamless approval journey
You can automate approval by setting a threshold limit i.e. when your employee requests for per diem allowance within the preset limit, the platform will automatically approve it. With platforms like Zaggle EMS, an expense management solution, you can set per diem allowance rates as per your expense policy and also customize the request flow based on your company hierarchy.
Paper-less finance processes
You can reduce the dependency on paper-based receipts when managing employee expense reimbursements. Employees can submit and track their requests digitally, while finance teams can process the payments right from the platform.
Smarter reporting & insights
Finance teams and senior management can get a detailed view of their employee’s spending behaviours and patterns to make better predictions. They can also generate reports and plan budgets for future business trips.
Fraud detection
With AI/ML algorithms, you can flag fraudulent reimbursement claims by verifying historical data and per diem allowance requests.
Improve Employee Expense Reimbursement with Zaggle
Zaggle EMS is an expense management platform that unifies your company-wide expenditure onto one platform giving you instant visibility into your expenses and expediting employee expense reimbursement. The platform ensures that there is transparency and efficiency in the expense management process.
