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Online visibility of card payments can be a game changer for businesses

Unlocking value

How reducing financial complexity can grow your business

Transparency is one of those words that has been talked about a lot recently. From Donald Trump’s tax returns (or lack thereof) to the EU opening its kimono on political lobbyists, transparency is having an impact across the spectrum.

In business though, transparency has a chequered history, particularly when it comes to financial services. While, historically, this may have made some sense, there is certainly a school of thought now that believes promoting a culture of transparency within an organisation is actually good for business.

For a start, a transparent culture is popular among staff. According to Neil Patel, co-founder of behaviour analytics site KISSmetrics, people are drawn to companies that are transparent and transparent companies tend to function at a higher level.

“As people become more transparent with one another, their relationships deepen,” says Patel. “And who is responsible for leading that move towards transparency? It’s the leadership of the business. Transparency has to start at the top.”

Reduce complexity

It’s a good point and very relevant. Companies traditionally overcomplicate their payments strategy, mainly because they must meet a broad range of payment demands from staff – e.g. multiple cards and payment methods across a range of suppliers. With limited or zero transparency, businesses have been subject to an increasingly complex process of card management, one that can not only overburden staff, but also lead to unnecessary costs and risk.

With no visibility of limits and no live understanding of balances, for example, how can staff operate efficiently? How can businesses really understand their full payment liability at any given moment in time? Throw in the demands of regulation and it makes for confusion, complex processing and frustration.

The Capgemini BNP Paribas World Payments Report 2016 talks about “increased complexity” in banking, particularly when it comes to coping with “the evolving regulatory landscape.” As banks adapt, it says, two key themes are emerging: the increased use of technology to ensure compliance; and a new facilitation approach adopted by some regulators to provide a safe environment in which financial services can innovate.

Improve visibility, security and speed

This innovation has to develop along increasingly transparent lines by embracing an online mindset, accepting that internet-based services are not only there to provide increased visibility, they are also increasingly secure and streamlined. Businesses with multiple card agreements, for example, can reduce costs and risks through a commercial cards deal, one that offers online access to payment history, limits and balances without having to wait for a monthly statement.

We’ve been used to this approach in domestic banking for years, so it makes sense to offer the same levels of service to businesses. With increased visibility of card costs and payments, businesses can start to streamline their payment processes by accessing all their up-to-the-minute reports in one place. With increased automation (invoice payments, for example), businesses can also start to maximise the service value of cards, using lower rates to their advantage and not viewing cards as a management burden.

Clearly anything that smooths processes, improves reporting for compliance purposes, increases payment visibility and adds to a transparency culture will only help reduce business complexity and make a business more attractive to customers and staff. And that, says Patel, “is the way business ought to be done.”