Modulr glossary

Accounts Payable (AP)

Accounts Payable (AP) refers to a business’s financial obligations to suppliers for goods and services received. Efficient AP management is critical for cash flow optimisation and supplier relationship management. With the rise of automation, businesses increasingly use virtual accounts and API-driven payment solutions, such as those provided by Modulr, to streamline AP processes and gather useful financial insights. Many businesses rely on Enterprise Resource Planning (ERP) software systems to process their business payments, such as supplier bills or payroll. ERP systems such as Xero or Sage can be integrated with embedded payments such as Modulr AP, able to automate business payments at scale and help minimise fraud, reduce errors, and streamline accounting.

Applications

E-commerce:

Reduces fraud in online card payments by verifying the cardholder's identity

Banking and fintech:

Helps issuers and payment providers comply with Strong Customer Authentication (SCA) requirements.

Advantages

Enhanced security: Reduces unauthorised transactions by verifying that the genuine account holder is authorising the payment
Fraud prevention: Helps reduce chargebacks related to fraud.

Challenges

User Experience: Additional authentication steps can cause friction and increase checkout abandonment
Implementation complexity: Requires integration with card schemes and issuer systems.

Item created by Modulr, Updated on July 2025

Solutions

Payroll Payments