Fraud and data security are quickly climbing to the top of accounts payable (AP) professionals’ list of concerns, according to new data from Levvel Research.
Commissioned by AP automation solution provider Tipalti, the research, announced Tuesday (Dec. 10), pointed to the growing volume of cross-border B2B payments in 2019 compared to a year prior. It showed 83 percent of companies made a cross-border payment this year, a 10 percent year-over-year increase.
While the surge in cross-border payment volume is reflective of corporates’ global expansion efforts, the trend may also be leading to heightened exposure to fraud and data breaches.
“There’s no denying that cross-border payment processing [is] on the rise and that they are more complex than domestic transactions,” said Levvel Director of Research Anna Barnett. “Businesses are realizing that they are exposed to fraud risk unless they put in place new controls.”
One-third of businesses surveyed said they are concerned about fraud, while 26 percent are worried about data security. The same percentage (26 percent) also said they are concerned about local tax and regulatory requirements related to global payments.
Supplier management and compliance was a concern cited by 23 percent of survey respondents, while 19 percent said the growing volume of international payments is a concern, too.
“The more international payments a business processes, the more likely it is to endure increasing pain points, including significant increases in AP workload, higher payment error rates, and increased tax and fraud risk exposure,” added Tipalti CEO Chen Amit. “Strong international payments policies and processes not only address these challenges but also help to protect an organization from various issues, including financial, data security and reputational risks.”
The survey, which included 450 professionals at companies across North America, also found that wire transfers are corporates’ most popular cross-border payment method despite high transaction costs and fraud risks. Sixty-nine percent of respondent said they use wire to move money across borders, while 38 percent said they use PayPal. Twenty-nine percent use ACH, with the same percentage saying they use checks.