Pakistan is taking a significant step toward promoting digital B2B payments in the country.
Banking Tech reports on Monday (Oct. 8) said business payments FinTech firm Haball is collaborating with electronic trading platform 1Link and Meezan Bank to develop a digital B2B payments solution. The tool would target businesses’ inter-company transactions for streamlined payments, bookkeeping and reconciliation.
Transaction settlements will be handled by Meezan Bank, while 1Link will process the payments, reports said.
“Haball provides businesses a convenient way to pay digitally and instantly, bringing efficiencies in existing business processes by streamlining existing workflows and improving productivity,” said Haball CEO Omer Bin Ahsan in a statement.
According to reports, Fatima Group will be the first company to trial the B2B payments solution. The company’s CIO Sardar Naufil Mahmud will deploy the solution within its order-to-cash and procure-to-pay processes, and integrate the tool into its existing ERP system.
Inter-company financial management is a challenge for many organizations, particularly multinational businesses with many ERP systems and business units. Research from Deloitte published in 2016 found that inter-company accounting can be a particularly high-risk operation and introduce more friction to company processes.
“While a lot of accounting, tax, treasury and other corporate leaders are focused on money flowing into and out of their organizations, inter-company accounting — or the money flowing across an organization’s legal entities — can become a real challenge to those experiencing global growth, M&A and supply chain integration,” warned Kyle Cheney, advisory partner at Deloitte & Touche, LLP, at the time.
Last year, the New York State Department of Financial Services (DFS) fined Pakistani bank Habib Bank nearly $630 million for non-compliance of state and federal U.S. laws pertaining to the bank’s single U.S. branch. The DFS reportedly discovered “significant breakdowns” in the bank’s anti-money laundering compliance. At the time, the bank said it would “vigorously contest” the fines.