It’s one thing to want to improve or innovate. That’s the easy part, the stuff of daydreams, scribbles, memos, charts and PowerPoint presentations. What’s harder — and what really makes the difference — is figuring how, where and when to innovate, a task that must take into account various factors and even wildcards that keep popping up in the growing and global digital economy and its various ecosystems.
In the latest edition of the PYMNTS Masterclass video series, Deirdre Ives, regional managing director of North America for Wirecard, a digital payments platform, takes viewers on a trip through the various issues involved in building a better payments and commerce machine — tech innovation, FinTech partnerships and other factors — to help them figure out how to best make progress in this fast-moving, increasingly complex world. Her observations cover a wide range of topics, but among the main themes is to look beneath the surface of technology, processes and innovation ideas.
As one example, take B2B payments — an area in which Wirecard is striving to build an even bigger presence.
This month, the firm launched a partnership with B2B networking platform Mercateo in a deal that has Wirecard powering B2B payments on the collaborative platform. Mercateo Unite connects buyers, retailers and manufacturers to facilitate B2B trade and procurement. Mercateo said Wirecard provides a custom accounts solution as well as same-day payment processing for transactions on Mercateo Unite.
In the PYMNTS Masterclass video, Ives noted the slow but (mostly) steady trend of bringing more digitization to B2B payments, where legacy paper-based processes, along with longstanding relationships and cultures centered around supply chains and invoices, can slow down online progress. At the same time, as technology spreads around the world to enable faster or even instant payments and disbursements, that appeal of quicker transactions is being felt in the B2B world.
Not Just Faster
Yet, as Ives said, it’s not just about “getting faster,” but also about thinking through the entire B2B payment process, and finding value from that. The adoption of digital technology that enables faster payments can open up room for B2B operators to offer, say, more discounts or financing options, which in turn lead to more market share. “Instead of 90-day payments, they can be facilitated in five days or less," she noted. "Once you can crack that nut, you can really see the benefits of faster payments delivery — alternative kinds of financing and improved cash flow across the corporate space.”
But it pays to keep in mind that payment involves various steps, all of which need the proper consideration. Ives offered the travel industry as an example. Payments typically involve an individual consumer (or business travel office) and the organization on the other end, and those transactions require not only speed, but also a high level of fraud prevention defenses. Thinking about how to improve those various parts of the payments journey can itself lead to significant innovation.
Bringing more speed and efficiency to payments, like other upgrades to technology and operations, often requires partnerships with FinTech providers — something that’s becoming an increased area of focus for those companies taking part in the global digital economy, thanks to regulatory factors such as Europe’s PSD2, along with other reasons. “Open up the doors and take those meetings,” Ives advised corporate executives about working with FinTechs — just agreeing to meet can sometimes require overcoming reluctance and inertia ingrained in some corporate cultures, though even when it comes to traditional banking, those barriers are being eroded.
But as Ives tells it, companies that open their doors to FinTech will benefit from fresh thinking from experts who might have a different but useful point of view.
FinTech companies can “come in and through a consultative manner talk about those pain points” that organizations are trying to alleviate, she said. “The ideas [FinTechs] bring to the table can mesh with the ideas [those other businesses] have already had, but struggled to implement,” she said. Not only that, but what amounts to the outside counsel of a FinTech can serve to get things moving for other businesses. After all, “one of the challenges corporates have is setting priorities as to where they want to improve” their operations that relate to payments and cash flow.
On one hand, the world is becoming simpler, given how digital technology gives companies efficient global reach. But as payment continues to morph from a simple, mundane and even boring process into a multi-part digital experience, more complexity is introduced, creating challenges for businesses. With the right mindset and consideration, these challenges could become opportunities.