One of the key phrases one will encounter at any cards-related meeting these days is supplier enablement, which historically has been a key challenge to gaining a larger share of B2B electronic spend. In this piece the discussion about the subject expends into ACH as well, and the general challenges to overcome the inertia around upgrading from paper-based payments. Some of this has to do with structural issues within banks, as well as resource limitations for corporate AP departments.
Banks don’t really have an efficient way to do supplier enablement, says Nvoicepay Vice President Sue Ellen Hodnot, writing in Digital Supply Chain. Card and ACH programs are usually offered by separate divisions within the bank. Some banks don’t even offer both, so you may have to go to different banks to get both programs. What this means is that there’s no easy way to share information between programs. If a supplier updates their information, it has to be updated in both places. And if a supplier who accepts ACH suddenly starts accepting cards, there’s no easy way for the buyer to find that out, she says.
In this discussion the emphasis is on persistence in gaining supplier agreement to move forward for electronic payments, under the theory that costs and efforts are better once understood, most suppliers will be happy to get paid however it may happen. Another point is that after the initial implementation set up, ongoing data updates are easier with modern cloud-based solutions.
According to Hodnot, collecting payment information and keeping it up to date when you have thousands, or even just hundreds of suppliers, is a huge effort…… New payments providers using cloud technology and good old fashioned customer service provide a total solution that closes the gap, bringing the full benefits ePayments automation to everyone.
The recent AFP electronic payments survey release indicates a flattening out of the prior ten-year trend for the decline in paper-based B2B payments. This is an interesting development. This article summarizes the importance of being committed to the continued e-payments changover.
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
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