Behind every company’s digital transformation is its need to meet customers’ needs. In today’s age, if a company is selling any kind of service or product, instant payment options are a must. However, many companies are struggling to keep pace.
According to the latest report by Modern Treasury, a payment operations platform, payment operations continue to be a trouble for the vast majority of companies. This leads to higher risk and operational costs, wasted employee time, and increased risk of audit errors.
The report found 88% of financial decision-makers say their company faces problems with payment operations, describing them as manual (47%), complicated (35%), slow (27%), and inefficient (26%). All of these make it harder to compete in a world that is rapidly shifting to real-time.
The biggest problems respondents cited were data quality errors (25%), protracted reconciling of payments due to manual processes (24%), a high rate of payment returns, refunds, and separately, payment failures (24%), and a high rate of reconciliation errors (23%).
Time waits for no one
Customers don’t, either. Many companies are already investing in their payment infrastructure to keep up with the pace of innovation.
The survey found that 84% of companies invested in payment operations within the last 12 months, with most companies investing in payment automation (67%). As companies automate, the survey found that they expect faster, more accurate reconciliation (47%), increased revenue (45%), better visibility into money movement (45%), faster bank integration (39%), and improved customer experience (37%).
Rachel Pike, Modern Treasury’s Chief Operating Officer, said: “Instant access to goods and services is now expected and, as this research shows, companies need efficient, real-time, and scalable payment operations to deliver that access. As businesses scale and transaction volumes grow, investing in modern payments infrastructure is no longer optional.”
According to Deloitte predictions, instant payments will replace up to $37 billion in B2B ACH and check payments by 2028. Instant payments deliver a better customer experience and improved liquidity. Still, they also require companies to have the back-office infrastructure to track and reconcile money in real-time to achieve complete visibility into payment status throughout its lifecycle.