Share
Written By :
Many companies are slow to change their payment methods. However, this is a major issue affecting their productivity.
The sooner your organization embraces this transformation, the sooner you will gain productivity and be equipped against threats to your data security. However, with so many available solutions, a clear strategy is needed.
Cheques, an outdated payment method
Even today, many organizations still issue cheques as payment. However, this method is expensive. According to some studies by Payments Canada, it costs between $15 and $20 to issue a single cheque. Furthermore, according to the Association for Financial Professionals (AFP), cheque fraud accounted for 66% of total fraud in 2021.
Despite the facts and studies on the subject, organizations continue to operate with this archaic payment method, under the false impression that any change would be too complex to implement.
Efficient strategy to avoid risk
Other companies have gone electronic, but without a clear enterprise-wide strategy. The result is redundant payment solutions and multiple, sometimes incompatible, processes within the same organization. This approach creates confusion, puts data security at risk and fosters fraud.
Additionally, the lack of interaction between the different systems requires numerous manual processes that hinder controls and productivity and increase the possibility of errors.
Optimized processes that will make you less vulnerable
In this situation, your company’s maturity is determined by how it complies with industry best practices in terms of payments and payment security.
To assess it, you need to analyze your processes and determine your vulnerabilities by asking yourself these important questions:
- Is the use of cheques still predominant in your company?
- Do you operate with manual processes and controls?
- Are there several payment solution providers, including banks, in your organization?
- Do you have processes in place for payments to providers, payroll and others?
- Is it easy to trace back the complete cycle of a specific payment (reason for payment, approval, issue, receipt, reconciliation)?
- How long would it take to detect a case of fraud?
- Do you have any measures to protect your providers’ banking data?
A technological solution for implementing best practices
For payment digitization, optimization and automation, the payment factory is simply the most recommended solution for most businesses.
A payment factory is a technological solution that meets all the abovementioned challenges. It allows for:
Centralization
A payment center is the bridge between the different systems and the financial institutions. It centralizes the processing of payments from the various internal systems.
Increased controls
The payment factory allows for flexibility in approval models and potential fraud detection. For example: three or more levels of approvals for payments with a non-standard value, or additional authorization for a first payment to a new provider.
Automation
The payment factory makes it possible to automate several steps in the payment cycle. For example: the payment notification to the beneficiary or reconciling payments by posting accounting entries.
Integration
Interfacing between different systems and financial institutions is key. It eliminates manual data entry, optimizes the entire process and helps achieve the desired efficiency. It also ensures increased security when information flows from one system to another.
As a technological solution, a payment factory would be the foundation for future payment solutions such as Interac for Business, real-time payments and many others.
In short, the payment factory will allow you to eliminate or reduce your vulnerabilities, as well as accelerate your business processes so that you can spend more time on profitable business activities.