How Do Electronic Payment Solutions Fulfill Supplier Needs?
Paying all your suppliers electronically makes sense—in theory. At a high level, doing so is a simple enough task—you enable your AP team to make all their payments through electronic means. Then you have yourself a cost-generating solution. But to your AP team—the people at ground level—there's much more behind the process than sending payments. They also must track sent payments, follow up on uncashed checks, handle fraudulent cases, and work with suppliers who are missing payments for one reason or another.
Unfortunately, most electronic payment businesses that tout themselves as solutions only find value at the high-level glance, which is a detriment to your team. For example, while banks and card networks move money electronically, they don't provide much supplier support, which is often needed to take payments across the finish line. In the end, that task often falls to your employees once again.
AP also tends to use the oldest equipment of any team in most companies. They're still running error-prone manual processes, with stacks of checks and invoices on their desks in need of circulation on foot. Process exceptions and one-off requests torment them. Suppliers are calling and emailing, looking for payment. At the same time, AP handles other issues like lost or erroneous invoices, payments landing in the wrong accounts, or which otherwise need attention.
The whole operation is like a house of cards. Even if you know you need to change, nobody wants to touch a single card for fear that the entire thing will fall apart. Asking them to enable suppliers for electronic payments is extra work, and not usually in anybody's job description. It's hard enough to get the regular work done; heaven forbid somebody on the team gets ill, goes out on leave, or quits. They're really under a lot of pressure.
A new generation of payment service providers automates payments in the cloud and offloads much of the support work that AP usually handles instead of focusing on higher-value initiatives. When your process was held together with duct tape and string, it can be hard to imagine confidently handing the work to a service provider. To understand what's possible today, let's look at what payment support services look like at scale here at Corpay.
When our customers sign on with Corpay, our implementation team goes right to work with their AP staff to get supplier lists and instructions for reaching out to them. If any suppliers require special arrangements due to prior agreements with them, we take those into account.
Our customers often pay many of the same suppliers. Because Corpaymaintains an extensive network of suppliers—about 800,000 of them—many suppliers are instantly payable without additional work. When suppliers aren't already in our system, we campaign to get them electronically payable in a fashion that meets their individual needs. We prioritize Mastercard due to the ease of payment for all parties involved. As time goes on, the Corpay team maintains supplier data, keeping up with changes on behalf of our customers.
Suppliers that still need to receive physical checks can do so. Even if they do, the process remains electronic on the AP side so that customers can issue check payments in the same batch as other electronic payments. Supplier questions are routed to our in-house support team, alleviating another large responsibility from AP.
Training and Implementation
While suppliers are being enabled, our technical support team trains the accounts payable group that will be using the software in a succinct, one-hour meeting. We know that AP turnover can be high, so we offer additional training by request to ensure that the customer's entire team remains up-to-speed.
Our technical support team also works with the implementation team to ensure that the initial configuration caters to each company's specific needs.
In the life of a manual process, AP teams need to fill out bank forms for each ACH batch or access their bank website to make wire payments. Payment automation consolidates those tasks—and more—into a single file from their ERP, which contains all the invoices the company wants to be paid. Corpay disperses those payments based on each suppliers' preferred payment type, set up in the enablement step, and continuously maintained.
On the back end, customers have total visibility into how those suppliers are getting paid, when checks cleared, and when Mastercard payments were issued. They can also track unprocessed Mastercard payments.
Corpay guarantees every payment, and as such, the phone number listed on the remittances is ours. If there's an issue with a payment, your suppliers call our payment support team directly, and we work through any questions they may have. Our software also includes a form that alerts our Payment Modification team of the need to resolve errors, refunds, reissues, or stop-payments. We turn those requests around quickly, as quickly as a customer could call their bank and do it themselves. We take as good care of our customers' suppliers as they would. No matter where an error occurs, we work to resolve it and to keep our customers informed throughout the process.
If a supplier reaches out to their customer directly, the customers also have visibility into our system. They can handle those one-off events without trouble.
Many AP groups have dealt with card programs that promised significant rebates but didn't deliver. Making as many payments as you can by card is what helps you maximize rebates. To aid this, another faction of our operations team—the supplier services group—reaches out to suppliers who haven't processed their cards after a set time. The team works with suppliers to answer any questions they have about the payment, and to support the processing of as many cards as possible.
Within the supplier services team is a retention group, which assists suppliers who may want to stop accepting card payment. That's the most beneficial payment method due to the rebate. Still, there can be various issues on the supplier end, such as card fees, or challenges with remittance or reconciliation. The retention group learns what the supplier objections are to card. If we can't work through them, we enable a different payment type.
While most suppliers can process virtual cards through their terminal once they receive the remittance, others have set requirements or separate terminals that require specialized processes. In those cases, our group called AP Concierge will either call the supplier directly to make payments or pay through their terminal. Our internal goal is to have less than three percent of unprocessed cards monthly. After 60 days, unprocessed payments must be refunded to the customer, which creates unnecessary work.
Embracing True Support
Why don't companies pay all of their suppliers electronically? Because it takes a village to do all the work around making payments! Corpay's dedicated teams support every piece of the payment process because we know that's what it takes. It's a rare AP team that can handle these pieces on top of getting payments out the door, let alone have special teams devoted to each area.
AP teams have been laboring under manual work and partially automated processes for so long; it's hard to imagine someone taking all that work off their plate. But that's precisely what we do.
And sometimes, it's hard to imagine what AP jobs will look like when the payment process becomes automated. We don't often see companies cut staff when they bring in Corpay. Instead, we have found that companies reduce their staff growth rate, and that existing staff moves onto higher-value work.