To say it’s been a busy week for Electronics Funds Source (EFS) would be a bit of an understatement. It was announced just this past weekend that the fleet payment solutions company has struck a deal to be acquired by WEX, the corporate payments company, to the tune of $1.4 billion. That may change the landscape of transport payments a bit (though, most immediately, the transaction helps reduce WEX’s sensitivity to fuel prices), but PYMNTS spoke at length with Scott R. Phillips, Electronic Funds Source’s president and CEO, before the deal announcement to gain insight on how the way companies pay at the pump is changing.
PYMNTS: The new SecureFuel solution uses telematics to automate purchases made with a fleet card to fuel up, but it also uses data from the fleet card itself. What type of information is SecureFuel obtaining from the card, and how will that help fleet managers control spending?
SP: Both EFS’ fleet cards and our new SecureFuel solution are powered by a core technology platform that enables robust data and purchasing controls that our customers adopt as part of the EFS program. Features include an extensive suite of policy- and card-based limits to better manage and control fuel expenses.
EFS enables fleet managers to customize these controls to best meet their business needs.
For example, there can be site restrictions which limit the cardholder’s purchase network; product restrictions which limit the types of products that can be purchased; and there can be velocity limits which restrict the amount of product (e.g., fuel) that can be purchased.
The SecureFuel solution works in conjunction with these controls by leveraging any telematics device on their truck to dynamically adjust these limits as needed, marrying telematics data from the truck with transactional data from the fuel card.
The SecureFuel application utilizes tank level data from the engine control module, or ECM, to help determine how much fuel a cardholder is allowed to purchase — based on the total tank capacity and level of fuel in the truck at the time of the attempted fueling.
Location information provided by the telematics device and GPS technology can be used to determine the location of the truck relative to where the fuel purchase is being attempted.
The SecureFuel solution can actually decline the attempted purchase if the GPS location of the truck does not align with the location of the attempted purchase. Alternately, the carrier can simply choose to receive an exception alert if they don’t want to interrupt the driver’s route by stopping the transaction. Our engineers can also identify purchase irregularities, including triggering real-time email and/or SMS notifications to carriers. In the end, all of this helps carriers better manage and control spending for one of their largest variable expenses: fuel.
PYMNTS: Do EFS cards automatically link up with a telematics-equipped vehicle? What type of visibility can fleet managers using an EFS fuel card gain in terms of spending analytics?
SP: EFS cards link seamlessly with a telematics-equipped vehicle through our SecureFuel solution once a carrier has subscribed to the service. At that point, in addition to the robust reporting already available on the EFS card, SecureFuel is able to collect additional information, such as current vehicle location, fuel level and odometer readings, at the time a fuel card is used.
This data can be used to confirm a vehicle’s proximity to a fueling location, determine fuel purchase limits and calculate a vehicle’s fuel efficiency between purchases.
PYMNTS: Telematics are on the forefront of fleet innovation. What does EFS see as the next frontier in fleet technology that could be used to help corporations control spend or ease payments friction?
SP: Throughout the payments industry, we are seeing an explosion in new payments form factors, such as Apple Pay, NFC and QR codes. All of these form factors attempt to accomplish the same objective: marrying payment credentials with an authorization to pay at the merchant’s point of sale.
EFS does this today. One of the unique capabilities EFS has in being its own network and processor is the fact that when cardholders transact, very little data resides in the mag stripe of the card. That data resides in our online systems, which gives us unique transaction controls, verifications and validations.
The primary reason EFS continues to issue physical cards is that our customers widely rely on the ATM networks and merchant point-of-sale systems that today are almost exclusively card-based. EFS can process transactions through any means without the need for physical plastic or legacy technologies, such as RFID tags, etc. On the other hand, telematics combined with payment processing enables a much more seamless, controlled and fraud-resistant experience.
PYMNTS: EFS provides other corporate payment solutions, like AP automation, T&E and payroll. While you're harnessing data from fuel cards and vehicles to make fleet spending more efficient, how else can Big Data be used by financial executives?
SP: EFS leverages the same proprietary approach to deliver the benefits of Big Data for both our fleet and corporate payments markets. One of the many advantages of having our own network is that we can capture and validate in a real-time environment.
Many times, EFS is viewed as a "card company" when the reality is we are a payments network, and we have the ability to process transactions and payments in either a closed-loop or open-loop environment, or both.
What this means for our customers is greater flexibility in payments functionality and better access to data as EFS manages the entire process using our network.
Since EFS focuses exclusively on the commercial payments (vs. consumer) market with our fleet, purchasing and T&E products, we are uniquely focused on providing data standardization and visibility of spending information for our customers across multiple, flexible access channels.
Our customers can readily access their own rich spend data directly through our EFS Web and mobile applications, via our direct integrations with ERP providers or through Web services via our APIs.
Through Software-as-a-Service (SaaS) solutions, we deliver dynamic purchasing intelligence, including executive dashboards for benchmarking a company’s spend performance and related KPIs against industry and peer group averages.
PYMNTS: Fleet is obviously a segment involving travel, often international. Is there a place for Big Data in easing cross-border fleet payments friction?
SP: One of the challenges in operating across international borders, as we do across both of our markets, is dealing with multiple currencies and the inherent challenges of measuring spend expressed in different monetary units.
EFS enables our customers to process Canadian transactions in Canadian dollars (CAD) and U.S. transactions in U.S. dollars (USD) or any combination thereof. We also provide our customers with the ability to easily measure and report their spending normalized across a single currency of their choice, where we handle all of the necessary conversions within our environment in order to ease the friction of operating in multiple currencies and with different units of measurement. For example, our Fleet Solutions customers can choose to have all of the trend and benchmark data we report to them be expressed in USD and gallons, even if some or all of their spend occurred natively in CAD and was measured in liters.