This piece is posted in PaymentsSource and written by the CEO of Paya, a payments integration firm that just went public and is now listed on NASDAQ. As readers will know, the pandemic and lockdown policies have had a terrible effect on the U.S. (and world) economy, with large production gaps and a number of permanent casualties among small businesses and specific verticals.
Mercator Advisory Group has been providing our thoughts through blogs and other channels. Companies have had to quickly shift processes and adapt to new systems to properly handle financial operations, most specifically in AP and AR. The author of the PaymentsSource piece points out some of the ways this has been happening, not only with industrials but also municipalities and NPOs:
‘Through the pandemic, a number of industries experienced firsthand the value of integrated payments. For instance, when the pandemic first hit, cities and municipalities scrambled to move all of their typical operations – from managing utilities payments to the processing of local licenses – to a remote format….They also found themselves facing potential cash flow issues and in need of new communications channels to keep citizens updated on civic issues and the local pandemic response. Municipalities were able to solve these issues by partnering with integrated payments providers to manage live customer service call centers, secure contactless kiosks, and quickly collect and reconcile utility payments all in one place….Nonprofits faced similar issues with donation continuity, compounded by an overwhelming increase in demand for food pantry services and financial assistance during this time. In response to these new constraints, we have seen nonprofits and faith-based organizations rapidly adopt and increase their usage of integrated payments.’
Starting in March, we have had a number of conversations across various parts of the financial services and fintech industry and heard similar stories. In effect, the previous cash cycle digitization trend, which had been gaining momentum during the past several years, has essentially accelerated out of necessity. The previous inertia has been replaced by a sense of survival mode among the most vulnerable entities, and a recognition of competitive disadvantages among others. So the tide has turned and the days of checks and analog processes are numbered.
‘The landscape for integrated payments has shifted dramatically as a result of COVID-19. While before the pandemic, adoption of these platforms was a valuable investment for the future. In the six months since its onset, integrated payments have proven absolutely essential to organizations’ ability to seamlessly conduct day-to-day operations, and to maintain their growth trajectory long after the pandemic subsides.’
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
