Globalisation is making International payments a more complex process for many businesses. As organisations expand their supplier bases overseas, the volume of cross border payments increases, as does the payment processing requirements for busy Accounts Payable functions.
However, according to PayStream, a research and advisory firm focused on business process automation, many organisations are still using payment processes for cross border transactions that are both inefficient and costly. The study also found that increasing international payment volumes in multiple currencies results in an increase in error rates due to lack of control and disparate systems. Add international tax and regulatory requirements, growing geopolitical concerns and fluctuating FX rates into the mix and the entire international payments process can become a headache for AP departments.
Disparate systems and manual processes – barriers to payment efficiency
When making international payments, many organisations will be aware that the payment data required differs to the more simple domestic payment process. As a result many AP teams have to use multiple bank portals to disburse funds in different countries. Cross border payments reconciliation also differs to domestic reconciliation and often requires time consuming manual intervention when several payment runs are made. Ailing legacy systems typically used by the banks to disburse payments do not provide the agility for a seamless cross border payments solution required by global businesses.
FileDirect – creating efficiency through automation
As part of one of Ireland’s leading FinTech solutions companies, FEXCO Corporate Payments developed the FileDirect solution to address the complex payments needs of businesses making high-volume, cross border transactions. The company recognised that clients were not only looking to make savings on FX rates and fees, but also on how they could create greater efficiency by optimising and streamlining their payments. Gaining better control of the payments process with greater visibility on reporting would also give finance managers the data required to make strategic decisions and to understand risk more clearly.
How FileDirect works?
FCP provides FileDirect integration which allows clients to upload a payment file (containing multiple payment types, currencies and destinations) directly from their ERP system to the FEXCO Payment Platform, PayDirect. FileDirect integration eliminates the need for any data entry between the ERP system [Agresso/Oracle/SAP etc] and the banking platform. This in turn allows clients to redeploy their staff in a more efficient manner whilst at the same time retaining control of supplier beneficiary data, as the repository for this information is the client ERP system.
Why FileDirect is becoming the solution of choice for Finance Managers?
FileDirect is a single file solution that consolidates all payments into one file meaning it is not necessary to separate products like Bacs, SEPA or Wire payments into multiple files for processing. Many alternative payment solutions like Bank of Ireland’s Creditor Automated Payment Services (CAPS) do not offer the time and cost-saving capability of the FileDirect single file solution. Instead, multiple payment types have to be separated into different files for upload to the banking system making the process time consuming and cumbersome.
FCP’s FileDirect integration offers a number of benefits compared to standard bank file integration, with greater flexibility, superior validation and automated reconciliation back to ERP systems. A significant number of international payment errors are caused by the lack of adequate bank account validation technology critical for the straight through processing of cross border payments. The FCP validation tool diagnoses and reports invalid payment data to reduce the risk that a payment could be lost or misdirected in the international banking system. This is why FCP achieves first-time delivery success rates in excess of 98% across all of its transactions.
Cyber security and fraud prevention – key to the success of the FCP payment solution
Financial fraud losses across payment cards, remote banking and cheques totalled £768.8 million in 2016, an increase of 2% on the previous year, figures from Financial Fraud Action UK show. A global survey of 376 business leaders revealed that 62% of respondents cited security concerns as a barrier to embracing cloud technology. These figures highlight the scale of the payments fraud problem and the concerns around security in global business. This is why cyber security and fraud prevention are the key pillars of FCP’s payments service.
In 2016, FEXCO Corporate Payments became the first Irish Payment Service Provider to receive the esteemed ISO 27001 Certification. ISO 27001 is the international standard, recognised globally for managing risks to the security of information held by an organisation. This means that the FEXCO payment platform, PayDirect is ISO27001 compliant with 2 factor authentication required for payment approvals using SMS and Google Authenticator. Many incidents of internal fraud take place due to non-segregation of duty in the payments approval process as well as insecure systems access protocols. Secure file transfer protocol (sftp) is standard for the FileDirect solution ensuring all information from the client’s accounts system to the FCP platform is secured to the highest of standards.
Key features of the FEXCO Corporate Payments solution
- FCP achieves a straight through processing rate of 98% across all transactions. This exceeds the industry norm of 95% and is exceptionally high, given that its customers tend to use FCP for complex payments while using their bank to deliver day-to-day domestic payments.
- FCP has a dedicated customer service team to provide query management and support to clients. The customer services team works hand-in-hand with FCP’s payments team to ensure that queries are resolved immediately
- Payments workflow approval built in with automatic notifications to relevant parties.
- Exchange rates and charges are very competitive and totally transparent.
- Feedback files to the ERP system automatically update accounting and supplier information.
- The PayDirect system emails automated confirmations to the user containing details of the payments made, and the PayDirect system generates automated remittance messages to payees if desired.
- Customers have access to detailed statements showing line-by-line information about each transaction conducted with FCP, including the rate applied and any fees paid.
FCP’s payment solution including FileDirect is the preferred solution for government departments, third level institutions and other large corporates with complex cross-border payment requirements. The integrated, seamless payment solution means that:
- Clients no longer need multiple foreign currency accounts thereby reducing costs
- Manual process are eliminated allowing the allocation of staff to more strategic tasks
- There is complete transparency on rate and fee information
- Automated reconciliation back to the client’s accounts system gives greater visibility on payables for reporting and auditing purposes.
Does your organisation make regular, multiple overseas payments? FEXCO’s FileDirect solution offers a seamless and integrated cross border payments service that saves time and money. Contact us on Ireland: 1800 246 800 or UK: 0800 840 2887 to arrange a demo or sign up for a free account.