U.S. businesses are losing the big bucks thanks to legacy, outdated expense management systems, finds a new report by virtual business payments firm Conferma.
The company published the findings of a survey on the matter today (April 21), concluding that $33 billion is wasted every year because companies fail to digitize and automate their expense management processes.
“What we are seeing here is billions of dollars being lost thanks to a confused landscape of multiple employees using multiple ways in business to claim expenses,” stated Conferma CEO Simon Barker. “It is costing U.S. businesses time and money to navigate this landscape and should be subject to much more rigorous control and oversight.”
For corporations with more than 500 employees, average losses hit $1 million a year, the research found. Further, 90 percent of companies surveyed said they face difficulties reconciling transactions made with cards that are used by more than one employee.
An average of 328 employees are authorized to use corporate cards within the businesses surveyed, researchers said, adding to the headache and confusion of so many transactions.
Many of the businesses surveyed understand that there’s a problem.
The majority (66 percent) of CFOs said that they feel their current expense management procedures take too long; 58 percent said it costs too much to do things the way they’re doing them right now.
These executives are also looking for a better way. According to Conferma, 90 percent of respondents said mobile payments can help solve some of the issues they face today in expense management, with 40 percent of CFOs in particular agreeing that mobile solutions could help. That figure increases to 49 percent of CFOs when focused on the financial services sector.
“The technology exists to help solve these problems,” Barker continued. “With innovations in banking technology and FinTech, there are ways in which a previously complex system can be streamlined and automated. In the mobile channel, for example, there are methods of integrated receipt capture, making the whole process seamless, intuitive and paperless.”