Global working capital cycles are under strain again. In 2024, Working Capital Requirements (WCR) climbed to 78 days, the highest since 2008. It’s driven largely by slower collections. Days Sales Outstanding (DSO) alone rose by more than 2 days globally. Nearly 1 in 5 firms now take over 90 days to collect cash. In manufacturing and internationally exposed businesses, this drag is even more pronounced due to payment norms, liquidity constraints, and structurally longer credit chains.
High DSO is a business continuity problem. It squeezes liquidity and stalls procurement cycles. Liquidity challenges defer inventory decisions and force companies to fund operations through external capital.
Traditional playbooks are not enough anymore
Most businesses with DSO more than 90 days rely primarily on two levers. One, reviewing payment performance regularly. Second, drafting more clear contract terms. These approaches are fine. But relying only on these narrow approaches could cause slower collection cycles.
On top of this, the environment itself has changed. Buyers are now spread across countries and each market follows its own payment habits. That makes it hard to run one consistent collection rhythm.
At the same time, supply chains have become more complex, so invoice disputes and exceptions are far more common. These issues hold up cash even when the customer is ready to pay. Most Accounts Receivable (AR) teams are still relying on manual follow-ups that are slow and inconsistent. It makes the old, human-only way of collecting simply too slow for the world we operate in.
You should look beyond the traditional AR practices. Clear payment terms, early payment discounts, improving invoice processing, setting credit limits – all these strategies still work. You don’t have to change the fundamentals. But you should modernize your processes with tailored approach for each customer risk profile.
How AI agents in AR help minimize DSO
AI agents in AR transform your cash collection from reactive to proactive. They change how timing, precision, and scale come together in collections. They predict which invoices may go late, and act before the delay happens. Agents plan next steps based on behavior, contract terms, and risk exposure. Let’s see how they make a difference across key AR areas.
Smarter invoice processing
Errors, exceptions, and missing information on invoices is a key contributor to payment delays. AI agents can iron out these challenges with streamlined invoice processing. They can validate invoices before they go out and perform 3-way matching. Agents can flag mismatches instantly and route exceptions to the right owner. This prevents invoices from entering dispute cycles in the first place. Clean invoices get paid faster because friction was removed before it reached customer.
Smart dynamic discounting and prompt pay discounts
AI agents also unlock dynamic discounting and early-pay strategies with intelligence. Instead of offering a blanket 2% Early Pay Discount to every buyer, agents can identify which accounts are likely to accept an incentive. They calculate the optimal discount threshold based on margin and liquidity needs and send targeted offers at the right time. So, you can protect margin while still improving cash position.
Better credit checks and limits
Credit control is another area where AI agents add discipline. Instead of static credit limits or one-time checks, agents monitor payment patterns and financial signals continuously. They can flag when a customer’s behavior starts to shift. For example, paying slower than usual or increasing order volumes without matching payment history.
When that happens, the system can recommend adjusting credit terms or escalating the account for review. This real-time visibility helps finance teams protect cash while maintaining healthy customer relationships.
Streamlined customer communication
Traditional follow-ups are manual, repetitive, and often too generic. AR teams go through aging reports, send batch emails, and hope for replies. AI agents bring structure and empathy to this process. They tailor messages to each customer’s history and tone.
For low-risk accounts, reminders stay polite and simple. For higher-risk or long-overdue ones, the tone is more focused on resolution. Agents can even choose the right channel: email, SMS, or automated call, depending on what gets faster results.
Consistent, timely communication keeps customers engaged and reduces disputes.
It also frees AR teams from clerical follow-ups so they can focus on strategic conversations.
High DSO signals risk, inefficiency, and missed opportunities. In volatile markets, cash speed is resilience. Even a reduction of 2–5 DSO days unlocks trapped cash. It lowers reliance on external borrowing and stabilizes procurement decisions. AI agents speed up collections and free your teams to focus on strategic decisions.
The question is how much faster and smarter your collections could be by putting AI agents to work in your business today. Seeing AI in action shows how these agents can adapt to your workflows, prioritize the right interventions, and unlock real cash flow improvements.
At Digital ClerX, we help you get a first-hand experience of AI agents in finance operations through tailored live demos. Book now.
