This partnership announcement is posted on Yahoo Finance and describes another integrated payables platform launch (or expansion), this one by Bank of the West in conjunction with Corporate Spending Innovations (CSI), the Florida-based payments fintech that is now part of Edenred. Most readers will already know that the momentum behind automated payables gathered a head of additional steam during 2020 due to WFM environments.
One of the somewhat surprising effects was the generally new level of supplier willingness to accept cards as a form of payment for invoiced payables. While card-based payments are relatively common for indirect goods up to a certain transaction amount, many suppliers who had previously resisted acceptance had to re-evaluate their position given the cash flow crisis brought on by the pandemic and lockdown policies. So this deal highlights cards as an integral part of the integrated payments mix.
‘Corporate Spending Innovations (CSI), a leader in electronic B2B payment solutions, announced today that they have teamed up with Bank of the West, a subsidiary of BNP Paribas, to launch V-PAYO, an evolution of their ePayables products and services that provides a unique payment experience for commercial customers and their vendors. This product offers clients greater automation, process efficiency, and digitization through an integrated payables experience utilizing a virtual card optimization process for B2B payments….Virtual cards streamline operations enabling corporate clients to work more efficiently. They replace paper checks with digitized B2B payments, making them more effective than traditional ACH. Expenses are greatly reduced, and the buyer and supplier portals provide payment visibility and status with faster and more comprehensive reconciliation. In addition, virtual cards allow for an increased float period, up to 55 days, which can help improve cash flow.’
Virtual cards are a convenient and safe way for a payer to settle with suppliers, providing the dual benefit of both improved DPO and DSO. If set up in a certain way, the process can be optimized for STP on both sides of the transaction, thereby reducing errors, re-work and processing expense.
We cover these factors and others in various member research papers. In our last projection during 2020, we expected a roughly 70% corporate card (T&E) spend reduction due to the lockdowns and travel bans, but continued growth in virtual card use for payables.
“The challenges created by the pandemic have accelerated the market need for corporate AP automation and invoice payment digitization and Bank of the West recognized this early on,” said Jim Foster, EVP Payment Partners & Financial Institutions at CSI. “We are excited about the opportunity to bring our CSI Paysystems technology assets and B2B payments expertise to bear in collaboration with Bank of the West to create the V-PAYO integrated payables solution and provide efficiency and cost savings to the bank’s commercial customers.”
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group