Profit from Electronic Accounts Payable Payment Strategies at Scale
By Ernest Rolfson, CEO, Finexio
The electronic payment science revolution has arrived. During the past several decades, the B2C and B2B markets have benefited from electronic payments. Clearing times have compressed, efficient payment methodologies have cut costs, and gigantic networks have created scale.
However, many organizations remain at the mercy of manual and costly AP systems dominated by the paper check. Checks are a relic of the past, first employed in 1681i. Paper checks have survived because there’s been no compelling and viable alternative with sufficient scale to displace them.
My company, Finexio, is at the forefront of B2B automated payment strategies. Specifically, we specialize in replacing the messy and costly work of paying by paper checks with online, easy to use electronic payments like ACH, Virtual Card, and e-checks. So, while I’ve spent my career developing fintech solutions, it was only a few years ago by founding Finexio that I leapt to the head of cutting-edge electronic payment science.
How Payments Got Here
I’ve witnessed and participated in many of the developments that have brought progress to the payments space. Since the early 2000s, my professional life has revolved around the accounts payable side of sales. My career began in consulting organizations, where I helped to integrate electronic payments and Accounts Payable best practice to provide CFO’s and Controller’s with more valuable time to focus on priorities. As a VP at Mastercard, I continued that work from the other angle by developing solutions to meet the electronic payment needs of healthcare payers.
In 2015 I founded Finexio, a company which optimizes B2B accounts payable payments. My passion is bringing the utility of a large network, ease of use, and automated payments from the card network side of the payments ecosystem to the B2B accounts payable space.
Finexio created the perfect segue between my previous work for companies such as MasterCard, where I gained valuable experience and connections working on the “inside” of payment processing. But doing what I am today is ultimately where the craft and science of payment fintech wants some development, and therefore for me is ultimately the more satisfying work.
Scaling the AP Payments Space
When it comes to financial products, payment card networks like Mastercard specialize in a few areas of the many in which banks deal, but at a much larger scale. A solution or technology that allows more effective payment for a bank is, along with other financial products like insurance or derivatives, a product to be sold. A bank representative when talking to the customer might emphasize the signing bonus, the ease of signing up, and the eventual rebate.
Fintech software-as-a-service companies are now extending payment systems to a meta scale. They emphasize the huge utility of a large network and the ease of usage. If they have time, they might also talk about the unique payment automation services they can provide. This is why I’ve pivoted to engineering and pioneering primarily in my work at Finexio.
Finexio, as I mentioned, is fundamentally a company that allows easier Accounts Payable payments with digital science. Like credit card companies, and like some larger banks, we offer a software platform that digitizes payments and thereby enhances efficiencies between our customers and their suppliers.
But where I think we depart from this model is in Finexio’s orientation to customer service. I would go so far as to say whereas Visa, or Citibank, is the tech support representative, we’re more like the hotel concierge.
Solving the Accounts Payable Payments Challenges
Finexio’s payments ecosystem works because we leverage scale and efficiency while providing concierge-level service for both our customers and their suppliers. We play both ends very successfully, which few companies can manage. First, we created a scalable network that functions effectively for all participants. Then, we follow up with unparalleled customer service, so that no payment, no supplier, and certainly no customer falls through the cracks.
For customers, we offer a completely secure and encrypted data system for payments. By merely uploading a .csv or .xls file to our system, customers are able to pay their suppliers the right amount — without the costs that attend paper— at the time of their choosing. We also keep track of supplier discounts in operation and alert customers when these apply to them. This facilitates the massively enhanced efficiency of the latest fintech innovation to combine with each customer’s unique needs and methods of reconciling accounts.
For suppliers, we provide faster and more secure payments combined with rich remittance advice, always tying back to a specific invoice or work order for easy reconciliation. Imagine — no more wasted time tracking down payment details or cashing checks. We also, of course, for buyers and suppliers include in the program self-service access into an online portal for all payment history and current transaction activity.
So, for example, while a supplier working with their financial institution or even credit card company to handle digital payments might wait on the phone for hours to talk to someone who knows anything and a week or more to find a solution—think of just how many other customers these institutions have which need some of the same things—we provide 24/7 supplier success to support your inquiries and guarantee a resolution within 24 hours of your call.
With our virtual cards, issued to all customers by secure email and weblink, you just enter the number into your point-of-sale terminal. These virtual card numbers have less risk and costs associated than issuing check or ACH, and they’re easily accepted by any supplier already accepting regular cards. In case of a transaction failure, again, we’re available around the clock to assist you by phone or email.
Efficient Payments, Today and Tomorrow
It’s a brave new world in payments software. Your organization can benefit from efficiencies, cost savings and more by automating your accounts payable function. Dumping manual processes in favor of working with payments experts like Finexio will bring your functions up to date, as well as provide valuable intelligence about your cash flow, payables and more. I invite you to call or email us to schedule a demo to understand how we can help your organization.
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