In what appears to be an interesting example of agile development, this Forbes article discusses a collaboration between developers at Visa and Oracle.
Since the article indicates a July start and now an October pilot, we assume some sort of scrum effort between the teams, with a ‘to be available soon’ tag for Visa Direct as a payment option for Oracle clients using one of the company’s ERP systems, which typically will provide either some direct payables functionality or integrate with 3rd party payables automation software:
‘Fueled with snacks, drinks, and cloud computing, the developers dug in, building a payment prototype that helps businesses better manage their cash flow and pay their suppliers and contractors quickly. About two months later, what was an idea is now a pilot product that will soon be available through Oracle ERP software, including Oracle ERP Cloud, Oracle E-Business Suite, JD Edwards, EnterpriseOne, PeopleSoft and Oracle NetSuite, powered by Visa Direct, Visa’s real-time push payments platform.’
This is part of an ongoing effort by Visa (and other card networks) to capture an increasing share of account-based payments, where the vast majority of payments types reside. This is both a growth strategy and hedge against potential slowing card-based payments adoption.
We have been pointing out this trend to our members for some time, most recently in a research piece around B2B faster payments. The primary target for this new payments solution is the gig economy (B2C), for which high growth expectations have resulted in many new startup entrants, increasing competition.
‘“The question that everyone has—whether they’re a freelancer, gig worker, or someone selling in an online marketplace—is ‘How am I going to get paid?’” says Bill Sheley, senior vice president and global head of push payments at Visa. “Visa Direct taps Visa’s huge network, which supports nearly 3.4 billion payment credentials and over 54 million merchant locations, and repurposes those capabilities to provide a network that can pay anyone, anywhere.”’
The massive transaction and value transfer in B2B is likely a secondary target. There can, of course, be some B2B application here as well, depending upon the payables systems set up, overall cost of transaction, and remittance data.
This will be something to watch going forward, but the effort towards increased digital payment choices, integration flexibility and transaction speed are helping to displace checks and outdated analog processes.
‘the growth in transactions beyond traditional plastic cards will continue, whether it be person-to-person, business-to-business, or through IoT-enabled payments. “Our mantra is around simplification and speed to market,” Sheley says. “We want smaller players to have access to the same features that the Fortune 100 companies have. We want to make payments simpler and more accessible.” ‘
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
