“Despite the reign of the paper check and manual-based processes in business-to-business transactions in the U.S. and many parts of the world, economic and efficiency gains from automating the financial supply chain – from invoicing through payment settlement – are key motivators for demand and supply to align,” said Nasreen Quibria, senior analyst at Aberdeen and author of the report. “While the adoption of electronic payment vehicles requires businesses to alter their payment behavior and restructure their financial processes, companies that can make the shift will gain competitive advantage.”
Reflecting the unpredictable economic conditions of the past year, Aberdeen found that companies are focused on maximizing cash flow and taking a holistic approach to transactions – examining the flow of funds into Accounts Receivable (AR), and outflow of funds from Accounts Payable (AP).
In its survey of more than 160 companies worldwide, Aberdeen found that businesses adopting electronic channels have been able to achieve a 16% decrease in accounts receivable (AR) processing cost, and a 14% decrease in accounts payable (AP) costs year over year.
“Aberdeen’s report shows the value that systems interoperability with electronic payment networks has for both buyers and suppliers,” said Greg Hammermaster, president of Sage Payment Solutions, the payments division for Sage North America. “We believe this interoperability is critical toward achieving three major payments objectives for every business: improving cash flow, reducing costs, and maximizing the utility of their ERP environment.”
The Aberdeen survey identified two main pressures creating the need for improved payments processing:
* Corporate mandate to reduce overall payment transaction costs, such as staff and processing (65%); and
* Stakeholder demand for improved operational efficiency, such as reduced reliance on paper documents (47%).
Also, according to Aberdeen, 50% of best-in-class companies integrate their electronic payment solutions with their accounting, enterprise resource planning (ERP), or other financial systems. At the same time, 39% of best-in-class companies identify a lack of integration between electronic payments and accounting systems as a barrier to increased electronic payments.
Last month, Sage introduced Sage Exchange, a new secure, Payment Application Data Security Standard (PA-DSS) certified payment platform that will allow businesses and organizations to accept all forms and methods of payment, with seamless data integration to a wide range of Sage business management software products and third-party business solutions. Seamless integration between payment applications and back-office software can improve an organization’s cash flow and forecasting, while eliminating manual data entry and the risk of errors.
“Integrating electronic payment networks with back office ERP systems is a challenge faced by all businesses,” added Hammermaster. “Sage Exchange overcomes this challenge by tightly integrating Sage’s accounting and ERP solutions, on both the AR and AP sides, with the most widely used electronic payment networks, including credit and debit cards, electronic check, ACH, and even private label networks. While electronic payments data integration is the foundation, exponential value will be gained through a suite of connected services focused on streamlining the financial supply chain. Sage Exchange is set to deliver on that value proposition.”
Aberdeen’s payments study was co-underwritten by Sage Payment Solutions and Syncada. A joint venture between Visa and U.S. Bank, Syncada provides a business-to-business network for financial institutions to enable their clients to increase control over their financial supply chains.
To download a complimentary copy of this report, please visit:
http://www.aberdeen.com/link/sponsor.asp?spid=30411867&cid=6594.
For additional information on Sage Payment Solutions, please visit www.sagepayments.com or call 800-261-0240.
About Aberdeen Group
Aberdeen Group, a Harte-Hanks company, provides fact-based research and market intelligence that delivers demonstrable results. Having queried more than 30,000 companies in the past two years, Aberdeen is positioned to educate users to action: driving market awareness, creating demand, enabling sales, and delivering meaningful return-on-investment analysis. As the trusted advisor to the global technology markets, corporations turn to Aberdeen for insights that drive decisions. For additional information, visit www.aberdeen.com or call 617-854-5200.
About Sage Payment Solutions
Sage Payment Solutions, the payments division for Sage North America, has been providing businesses and organizations with electronic payment systems for more than 20 years. The company makes electronic payment processing easy for more than 140,000 companies, allowing them to accept multiple forms of payment, including credit and debit cards, electronic checks, Check21, gift and loyalty cards, and automatic recurring payment. Sage Payment Solutions provides a wide range of secure standalone and integrated payment processing solutions. Sage Exchange, its recently introduced PCI-certified payments platform, integrates with many Sage software products to maximize the value of customers’ business systems with automatically updated credit and debit card transaction information. Future Sage Exchange releases will offer additional integrated payment capabilities, including advanced point-of-sale (POS) device integration, payment origination solutions, and cash management applications. For more information about Sage Payment Solutions, please call 800-261-0240, or visit www.sagepayments.com.
About Sage North America
Sage North America is part of The Sage Group plc, a leading global supplier of business management software and services. Sage North America employs 4,000 people and supports 3.1 million small and midsized business customers. The Sage Group plc, formed in 1981, was floated on the London Stock Exchange in 1989 and now employs 13,100 people and supports 6.2 million customers worldwide. For more information, please visit the website at www.sagenorthamerica.com.
