The corporate payments market is at a critical juncture in today’s banking landscape. Improved customer experience in the retail payments segment—driven by mobility, cashless transactions, easy accessibility and cost-effectiveness—has increased expectations in the corporate payments system considerably. For example, it takes a few minutes to browse, select and purchase grocery items through an online app, whereas it takes days, or even weeks, and loads of paperwork to procure stationery items for the office through the traditional corporate payments system. In such a scenario, there is a growing demand to usher in substantial change in the corporate payments landscape on both sides of the bank-client relationship.
To achieve these objectives, the corporate payments sector has to first overcome several challenges, such as fragmented banking products and relationships, rigid and paper-based processes, lack of transparency in payments, costs of complying with new regulations and problems related to cross-border transactions.
Accenture is helping banks to seize the growth opportunity in corporate payments by encouraging them to invest in technological innovations, define new operating models by becoming “trusted advisors” and collaborate with financial technology (Fintech) start-ups instead of competing with them.
Transforming corporate payments for the digital age
Our report highlights six key findings and analysis about how market changes and trends are impacting and reshaping the corporate payments sector globally:
Virtual account solution can automate collections and reconciliation by providing 100 percent accurate identification of the payer and invoice details.
Mobile delivery and real-time services enable banks to provide status updates on immediate payments and account balances through multiple channels such as SMS, e-mail, WhatsApp and alerts on corporate portals.
Standardization of connectivity between corporate customers and banks facilitates banks and third-party vendors to move closer to their corporate customers and integrate themselves into their value chains.
Availability of banking information through APIs enable corporate customers to manage all their payments and cash management from a single portal across multiple banks.
Regulatory changes have allowed banks to use digitized images, scans or photographs of checks for processing, rather than the original paper document.
Usage of new technologies such as distributed consensus ledger and bitcoin will have an impact on efficiency, trust and transparency in payments.
With the banking landscape becoming highly competitive due to innovative corporate payments solutions, banks need to focus on three key priorities to sustain corporate relationships and achieve higher revenue growth:
Play a consultative role. Instead of selling corporate payments products, corporate customers expect banks to be trusted advisors, partnering with them to develop deep insights into the challenges they face, advising them on optimal solutions and customizing their services to deliver a differentiated experience.
Collaborate instead of competing with Fintech. Banks can leverage Fintech companies’ disruptive innovation capabilities and their effectiveness with digital technology, while Fintech companies can tap into banks’ core expertise in banking and the associated risks.
Adopt digital to stay relevant. Smaller banks need to leverage innovation and digital capabilities to compete with global banks while serving large corporates and multi-national corporations.