B2B Payments

Mastercard Track Fast-Tracks Supplier Vetting, Onboarding

It takes an average of 16 friction-filled, often paper-intensive days for a buyer to onboard a supplier. Mastercard and Microsoft have teamed to launch Mastercard Track, a digital platform to fast-track trade between trading partners by streamlining the supplier discovery, vetting and onboarding process. Carlos Menendez, Mastercard president of enterprise partnerships at Mastercard, and George Zinn, corporate VP and treasurer at Microsoft, tell Karen Webster how buyer-supplier networks plan to use Track to streamline trade and build trust.

Global trade: done digitally and without paper, phone calls and emails that fly back and forth between borders. As buyers seek suppliers and as suppliers enter data, each time, new relationships are forged.

Getting suppliers onboarded takes a while — about 16 days, in fact, due in large part to manual processes. Add up those 16 days for each new link in the supply chain, and it’s clear that an easier onboarding process means business could get done a lot faster. Other inefficiencies abound: Transactions are done in cash or by check, and invoices are lost in the mail.

Time for B2B to enter the digital age, for data to be entered once (and for all!) by suppliers, and for time and cost savings to accrue to all parties — a goal behind a new global trade platform from Mastercard in collaboration with Microsoft. The two companies announced Wednesday (Sept. 12) the debut of Mastercard Track, eyeing the cloud and a global directory (more on this in a bit) to help streamline trade between firms via online platform.

Writ large, the B2B space is staggering in its size: Worth as much as $120 trillion, according to oft-repeated industry figures. Complexity also marks that landscape, with a slew of new rules and regulations spanning the globe, and where firms venturing beyond their domestic borders may struggle to navigate the particulars of new markets.

The firms noted on Wednesday that there have been parts of the B2B continuum that have been digitized. However, “gaps still remain,” where half of transactions are done on paper and administrative costs are $500 billion annually and rising.

In an interview with Karen Webster, Carlos Menendez, President of enterprise partnerships at Mastercard, and George Zinn, corporate vice president and treasurer of Microsoft, said the platform (powered by Microsoft Azure) spans activities across identity, compliance and payment management.

Speedier Onboarding Through Centralized Data

The overarching theme: “Trusting your counter-party is fundamental to business,” said Menendez, who noted to Webster that “our underlying assumption for the whole platform is that it’s a fragmented world. There’s information in many public and private sources; it’s just difficult to consolidate in one place.”

They said that as part of the Track offering, there is the ability to store documents in a single repository. For example, after a firm enters insurance documents and licenses, updates get pulled through automatically.

According to Menendez and Zinn, through Track and an attendant directory of more than 150 million company registrations and records globally, suppliers need to enter their identification data only one time, while buyers can streamline the onboarding process  which, done manually through today’s prevalent methods, can take an average of 16 days.

Menendez recounted that, in an effort to make sure buyers understand just who their suppliers are and that the converse is true, the aforementioned central directory integrates feed from more than 4,500 compliance lists into one place. Zinn noted that the cloud computing service operates in over 40 countries and 54 regions, which enables that breadth and depth of data collection and dissemination. That centralized information flow gives firms of all sizes that ability to manage risk, getting an update on a firm’s full supplier base, spanning from sanctions to negative press articles.

“If you have a sense of the crowdsourcing of the information,” said Zinn, “you will be in a much better position to be compliant.”

Daily alerts enable efficient and holistic risk management, which is an improvement over current practices, where businesses monitor only about a third of their supplier base, said Menendez and Zinn. Of course, both sides of the buyer-and-supplier equation want to get paid with speed, tracking transactions to see whether invoices are yet to be paid, in process or hitting accounts. Part of streamlining that process is better payment visibility.

As done currently, said the pair, the tracking of purchase orders, invoices and payments takes place by gathering information across disparate systems. Here, with centralized data that extends across several B2B networks, firms can track bank transfers, accounts and card-based payments (and is payments agnostic).

As for the networks and the directory itself, Mastercard is partnering with nine B2B networks and procure-to-pay providers, a roster that includes (alphabetically) Basware, BirchStreet, Coupa, the Infor and GT Nexus commerce network, Ivalua, JAGGAER, Liaison Technologies, Tradeshift and Tungsten Network.

Zinn said, “Mastercard and Microsoft are providing the technology behind the directory, but the relationships are between the B2B networks and their buyers and suppliers.”

Microsoft, said the executives, has access to the Mastercard directory, which gives the sense of which companies are real and have a public footprint. When a network invites a supplier into the space, those firms can feed in incremental records, such as banking details, which makes it easier for them to serve new buyers without having to provide the same information multiple times.

Among the end results, as noted by Menendez, firms have traditionally made business decisions “without understanding the group of people [they’re] working with — and it’s too much trouble to expand the supplier base.” That complacency ends as the platform, powered in part by artificial intelligence (AI), keeps feeding fresh and relevant information across a supply chain and illuminating new, alternative choices that may be a better fit.

In terms of rollout, the platform is live across Singapore via its National Trade Platform, where it is being used across logistics functions, and will be rolling out over the first quarter in the U.S. and the U.K.

“What we hear from our customers is ‘I need to better manage my full supply chain,’” said Menendez.

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