Keep Moving Forward. How to Accelerate Your Electronic Payables Momentum. UMACHA Navigating Payments October 8, 2014

Transcription

1 Keep Moving Forward How to Accelerate Your Electronic Payables Momentum UMACHA Navigating Payments October 8, 2014 Peter Zakrajsheck Payables Product Manager Greg Rettinger, Vice President Global Treasury Management

2 Agenda Payment market trends Fed Payment Study 2013 Remittance Coalition Study 2012 AFP Studies 2013 Are you making progress? Just moving from paper checks Maturing in electronic payments (ACH, Card, Wire) Cutting edge Strategies for expanding YOUR electronic payments program This information represents the opinion of U.S. Bank and is not intended to serve as a recommendation or solicitation for the purchase or sale of any particular product or service. It does not constitute advice and is issued without regard to any particular objective or the financial situation of any particular individual. These views are subject to change at any time based upon market or other conditions and are current as of the date indicated on these materials. Deposit products offered by U.S. Bank National Association. Member FDIC. 2

3 Keep moving forward Around here, we don't look backwards for very long. We keep moving forward, opening up new doors and doing new things, because we're curious... and curiosity keeps leading us down new paths. The way to get started is to quit talking and begin doing. Walt Disney 3

4 Are you making progress? Just moving from paper checks Map out current process what are your e-options? Review IT resources and get senior manager buy-in Maturing in electronic payments looking for more value Conduct A/P analysis with bank partner Canvas suppliers use electronic payments with everyone who accepts them Cutting edge Conduct holistic working capital analysis with bank partner Examine purchase-to-pay in context of entire treasury continuum Responses from IOFM s Paperless Accounts Payable Survey,

5 Corporate payment trends Change in payment type 2012 to 2013 P-Card ACH Wires Decreased Stayed the same Increased Checks Source: Electronic Supplier Payments, Paystream Advisors, Q

6 Corporate payment trends Payments made by check in a typical organization 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Source: Electronic Payments Survey, Association for Financial Professionals, Nov

7 Payment trends ACH payments ($ Billions) Source: 2013 Federal Reserve Payments Study 7

8 Payment trends Likely to convert from checks to electronic payments for major suppliers in three years 60% 50% 40% 30% 20% 10% 0% Very likely Somewhat likely Not likely Majority already electronic Source: Electronic Payments Survey, Association for Financial Professionals, Nov

9 Payment trends Barriers to electronic payments Convincing customers to pay Convincing suppliers to accept Lack of IT Resources Lack of standard format No technology integration 0% 50% 100% Source: Electronic Payments Survey, Association for Financial Professionals, Nov

10 Breaking down the barriers Suppliers may be more receptive than you think Conduct an A/P analysis Technology advances are making integration easier Core need is to integrate with accounting system to allow customer to generate payment files, and to reconcile incoming payments Ultimate goal is straight-through processing and automation Multiple tools to support this process: Middleware and/or PC based applications Workstation modules Data integration services (financial institutions) Web-based modules 10

11 Finding yourself on the automation spectrum? Things to consider 11

12 Just moving from paper checks? Checks/Paper Payments Cost per payment $$$ Higher fraud rates Environmental impacts Decreased float Legacy systems and obsolescence Electronic Payments Cost per payment ACH $$ and Card $ with rebate Low fraud rates compared to paper Easier to make international payments Control timing Potential IT resources Primary goals = Cost savings, operational efficiency and enhanced control over spend 12

13 Just moving from paper checks? Key considerations Current systems IT resources Procure and payment process What is the right payment mix for your business? ACH, Card, Wire Electronic payment benefits Cost reduction physical Less fraud risk than checks Positive environmental impact Increase working capital and take advantage of discounts and rebates 13

14 Maturing in electronic payments Demands on A/P growing Add value Cost savings ACH for multiple purposes Expansion of current uses Use of remittance International payments Increased automation Movement to Card and Electronic Accounts Payable Traditional purchasing cards Ghost Cards and Virtual Cards Map out A/P and look for opportunities 14

15 Cutting edge Volume and automation Straight-through processing Full integration with ERP system Lowest net cost per invoice or payment Consolidated payables Electronic invoicing Greater collaboration with suppliers 15

16 Cutting edge Wires expanded remittance Direct API link or customized portal ACH XML remittance, advanced account validation, expanded international ACH 16

17 How do I expand my electronic payments program? Map processes Evaluate systems IT resources Consult banking partners Consult trading partners Drive adoption Get senior management buy-in 17

18 Questions 18

19 Thank you! Peter Zakrajsheck Payables Product Manager, Corporate Payment Systems (612) Greg Rettinger Vice President, Global Treasury Management