Commercial Payments Podcast with Keith Pierce, TSYS
Business-to-business electronic payment solutions have been on the corporate “to do” list for some time now, but finally, there seems to be a growing interest among companies to figure out how to adopt these solutions. Lowering the cost of payments, controlling company spending and harvesting data assets to assist with both are the major drivers. In a recent podcast interview, Group Executive at TSYS Commercial Card Keith Pierce spoke with Market Platform Dynamics CEO Karen Webster to discuss why the time is now to say yes to B2B card-based payment systems.
TSYS has been at the forefront of this space now for more than 12 years and has occupied a powerful perch for observing a number of trends, that Pierce says bodes well for the adoption of new ways to crack the code on commercial payments. While checks still dominate B2B payment today, Pierce says that is on the decline, thanks to technology solutions that are now available and continuing to evolve. Issuers, for one, he says, now view B2B payments as a growth opportunity as they search for ways to expand upon their commercial card portfolios and have a number of new tools available to them to take to their corporate users.
“There’s been a high adoption and great success with T&E and purchase card programs, leading the way for issuers of corporate payment cards to continue to invest in their products and solution and grow by a significant volume,” said Pierce. More specifically, he said, electronic-based payment processes are replacing checks in the accounts payable space with purchase cards leading the way. Innovations around single-use virtual account solutions, Pierce says, will also continue to drive adoption of card-based B2B payment systems.
For example, “single-use virtual account solutions offer better security and better reconciliation of B2B payments, and these combine with the user interfaces that are driving accounts payable integration,” said Pierce.
While adoption of B2B electronic payments is increasing, there are still several barriers to the process. These challenges, said Pierce, are frustrating and slow the adoption rate. For one, it is difficult to get suppliers to accept card-based payments given the economics associated with those programs and the issues associated with integrating with ERP and other accounting systems.
Regardless of the barriers, there has been a breakthrough as a result of industry-wide education, as more realize the ROI of such programs and ease of implementing the variety of solutions available, said Pierce. Banks, in particular, are doing a good job in leveraging their expertise in card payments. In choosing a solution, Pierce recommends that companies encourage corporates to reach out to their card providers, work to develop a business case, and educate their supplier community on the benefits of adopting card-based payment systems. Companies should also assign a “champion” who will work inside on the initiative, he said.
“Organizations need to be prepared to work in partnership with their card providers through the implementation process,” said Pierce. “They must configure the program to meet the company needs.”
For more on TSYS’s perspective on commercial payment trends, listen to the podcast here.
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