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    Payments Processing to Power Autonomous Commerce

    Payments | Procure to Pay | Source to Pay

    I find it curious that “Procure to Pay” solutions are named after the final step of the procurement process – payment. This is a step the most procure-to-pay solutions don’t automate. B2B payments live in an antiquated world where the paper check is still the payment method of choice. In 2021, 52% of JAGGAER invoices were paid by check. Fortunately, all of that is about to change.

    As a consumer, when I visit an eCommerce store, I expect to find what I want and check out based on intelligent recommendations from the merchant. Not only do they help guide me to fill my cart, but they also know what payment method I am likely to prefer. If shopping using an iPhone in the US they suggest Apple Pay or credit card, but using a Google Chrome browser in the UK they suggest Google Pay or Klarna.

    Why does a B2B transaction require convoluted back-and-forth between buyer and supplier to select a payment method, often settling on the least common denominator – a check? In a world of asymmetric information, buyers and suppliers are often unaware of the preferred payment methods of the other party. Furthermore, optimizing payment terms (e.g. Net 15 if paid by card, Net 30 if paid by check) creates additional complications for managing different classes of buyers and suppliers.

    Autonomous Commerce is changing the way businesses conduct enterprise commerce. JAGGAER’s extensible autonomous commerce platform allows buyers and suppliers to explore and deploy complementary software solutions, already integrated with JAGGAER’s core offering. Fully integrated payment solutions eliminate the inefficiencies of AP payment processes and optimize working capital so that buyers and suppliers can be paid how and when they want.

    It costs an AP organization an average of $8 to process a single payment1, and 62% of these costs result from labor2. AP clerks spend most of their time corresponding with suppliers to add or update payment information and ferrying payments through various approval and processing tasks. These processes are manual and time-consuming; it’s the classic case of highly skilled teams performing low-value tasks. AP teams perform a host of tasks outside their core skillset – from marketing (running campaigns to convert suppliers to electronic payments) to security operations (screening supplier accounts for potential fraud).

    JAGGAER’s platform eliminates these tasks using modern software tools and data gathered across its network of over 5 million suppliers, enabling your talent to focus on high-value, strategic work. Once payments no longer rely on manual processes and paper checks delivered by mail, buyers and suppliers can match on the preferred payment method to support each unique relationship. As with consumer payments, JAGGAER intelligently guides each party to select the preferred payment method to support their unique strategy.

    With easier control over payment terms and monetization opportunities through rebates, businesses can optimize working capital and convert payments from a cost into a revenue center. In the process of intelligently converting suppliers off manual payments, virtual card programs can be strategically grown. Again, as with consumer payments, many businesses are willing to pay a premium to provide their customers the convenience of paying by credit or debit card, generating “cash back” (aka rebate revenue) for the buyer.

    JAGGAER Pay completes the vision of autonomous commerce by realizing the “pay” in “procure to pay.” Automated and simplified AP payment processes enable businesses to reduce costs, increase efficiencies and improve cash flow. Please contact us to learn more about how JAGGAER’s extensible solution is providing businesses like yours with the tools to achieve an autonomous commerce experience.

     


     

    1ePayments Rising: The 2014 Market Report, Ardent Partners, 2014
    2APQC Research Electronic Payments and Card Solutions, Paystream , 2015

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