What Do the Robots Know About B2B Payments? More Than You Think

In 2019, it is rare to find a business category that is still inundated with manual and/or paper-based processes. But so goes the $115B wholesale payments space, with approximately 30% of transactions still being handled today by paper checks (yikes!). And despite some automation advancements, enterprise payments remain a complex litany of disparate processes that are burdened by fraud, extraordinary and unnecessary labor costs and substantial errors.

So why the significantly delayed transition from paper to digital payments transactions across the board? Because so many enterprise payments require the precise application of rules, policies and analysis that so often necessitate the human touch to transact and approve. Until now …

A relatively new but increasingly adopted application – Robotic Process Automation (RPA) – is overhauling enterprise payments processing in a way that maintains the oversight often thought to be found in the old paper guard by eliminating human effort, errors and fraud that hamper today’s traditional payments processing.

RPA enables businesses to automate mundane, rules-based processes so employees can focus on higher-value business functions. In fact, new data from Gartner estimates the RPA market grew more than 63% last year, making it the fastest-growing enterprise software category, and that RPA software revenue is forecasted to reach $1.3 billion in 2019. The technology is currently being used in a variety of business functions in today’s enterprise, including customer service, marketing and legal.

After having proven itself worthy in these categories, today’s forward-thinking companies are looking to RPA for enterprise payments. This application enables them to integrate their disconnected vendor payment systems, expense management platforms, paper-based payment processes and accounting platforms, to name a few. What was once a byzantine system of human-centric and static batch-file processes can now be fully automated and scalable in real-time, enabling seamless processing across any ERP platform, bank, credit card or currency.

Some companies are using RPA to help create virtual payment solutions that enable them to control employee spending within certain guidelines. Blockchain technology company ConsenSys, for example, uses virtual payment solutions for travel-related expenses. RPA technology allows ConsenSys to solve a major pain point for the company’s travelers — the need to put hotel charges on their personal cards and then submit them for reimbursement — while also driving greater adoption of the travel program, better controlling hotel spend and generating far more actionable data.

While implementing an RPA system for payments is significantly less intrusive and time-consuming than bespoke payment-processing solutions otherwise available, there are considerations and best practices for companies to consider. RPA does require the proper design, planning and governance to generate meaningful results that transform the accounts payable function.

Here are three tips for the effective integration of RPA to enable the transparent, seamless processing of payments across the enterprise, including:

  1. Ensure IT is involved in all aspects of the deployment: While the payments function is traditionally in finance’s purview, it is critical for IT to play an integral role in this cloud-based deployment that incorporates their ongoing buy-in, insights and resources
  2. Remember that employees will be concerned about the potential loss of work: Indeed, the use of RPA is intended to dramatically reduce employee time involved in the payroll function, but in return frees up time which is better suited to more rewarding and productive work. It will be important to involve human resources to help guide the transition with existing employees.
  3. Monitor the effectiveness of the program to tweak the predetermined RPA rules: The need for human oversight will be critical at the early stages of the implementation and while that need will decrease over time, ongoing oversight and management will be important to ensure that the implemented rules are delivering the maximum effectiveness.

Companies today are deploying RPA technology across a variety of business functions to streamline processes, reduce costs and increase their accuracy. Given the often overwhelming complexities and human-centric nature of payment processing, the category is ripe for disruption. Thanks to new, modular RPA solutions that can be up and running in weeks, not months or even years like previous custom payments options, companies in any industry can rid themselves of the arduous function of payment processing across a variety of business disciplines.

Kurt Knackstedt is the CEO and co-Founder of Troovo, a digital B2B payments processing company for the enterprise.