At AribaLIVE today in Washington, D.C., Ariba and Discover Financial Services jointly introduced AribaPay, a new function planned for the Ariba Network, which will enable participating buyers and suppliers to take their transactions one step further than before by initiating the payment from within the Ariba platform.
The two firms are working together to develop the necessary interfaces, and expect that the function will be live and available in 2014. The initial release will focus on those supplier payments in the U.S. market that are still settled by check, substituting an ACH payment linked directly to the transaction details contained in the Ariba Network.
According to the companies:
When launched, the cloud-based service will combine the applications and insights embedded in the Ariba Network and deliver them through Discover’s trusted global payments infrastructure to streamline and enhance settlement and reconciliation of business commerce.
Virtually all of the B2B supply chain networks currently in operation, including Ariba, have long been focused on resolving the inefficiencies associated with the multiple documents that drive buyer-supplier relationships, especially the purchase order and the associated invoice. None of these networks have yet associated the final payment with the initial underlying documents describing the merchandise transaction. Although commonly described as “Procure-to-Pay” process enablers (AKA “Order-to-Cash” from the supplier side), today all of them actually stop just short of the payment itself.
According to the joint press release:
For buyers and sellers connected to the Ariba Network, AribaPay will deliver data that shows what payments represent at the invoice and line-item level, fueling faster, more accurate reconciliation on both sides.
Linking the merchandise transaction data to the payment transaction data has been identified as the key to “straight through processing” for corporate expenses on the buyer side. It is also a critical element in Account Receivable reconciliations, enabling efficient allocation of payments to appropriate invoices. To date, such detailed expense data has sometimes been available to buyers in association with card transactions that present so-called Level III data. With this announcement, Ariba and Discover have fired the first salvo, promising for 2014 a new stage of competition for efficiency in both the “Procure-to-Pay” and “Order-to-Cash” business processes.
Click here to read more from the joint press release.
