The two payments companies announced Tuesday (May 2) that they’d formed DPX Payments, a joint venture aimed at offering “advanced payables offerings to the large and underserved middle-market.”
DPX, the companies said in a news release, is aimed at businesses that send payments to vendors and suppliers using paper, arriving at a time when the U.S. appears to be increasingly moving to electronic invoicing.
“DPX Payments is the next step in the omnichannel payment strategy of Deluxe, offering an even broader range of digital payment solutions to the middle market,” said Michael Reed, president of payments at Deluxe. “DPX Payments reduces the burden on AP [accounts payable] teams to worry about whether their payee can accept their preferred payment method, regardless of payment type preference.”
Echo and Deluxe have worked together since 2019, when they launched their Medical Payment Exchange, which processes more than $20 billion in payments annually.
The new venture “expands the partnership to offer these advanced payment capabilities to all businesses, with support for multiple payment types, including ACH, virtual card, paper check, push to debit card, and e-check, among others,” the release said.
As PYMNTS wrote last week, the shift toward electronic invoicing — and away from paper — will get a “significant tailwind this year in the United States.”
That’s because the Federal Reserve and the Business Payments Coalition (BPC) have been advancing a pilot exchange framework, first announced in 2021, that will connect businesses so that they can exchange digital invoices.
“As 2023 progresses and as the exchange looms, one end result would be a transformation of B2B payments, where, as noted in this space, as many as 45% of smaller firms have cited manual invoice review as a pain point when making payments,” PYMNTS wrote.
And research detailed in a PYMNTS Intelligence study last year showed that companies implementing AP and payments automation saw cost savings of about 70%, along with faster processing times.
There’s a major greenfield opportunity to upgrade those back-end tasks: A total of 88% of AP professionals in another report blamed the preponderance of payment errors on manual systems. Respondents told PYMNTS that it takes an average of 11 days to get department heads to approve their invoices. Of those AP professionals who had automated their accounting and invoicing, nearly three-quarters said they had fewer late payments.