Posted by Mark Brousseau
After years of being relegated to the sidelines as a result of the economic downturn, attendees at this week's AFP Annual Conference at the Henry B. Gonzalez Convention Center in San Antonio, Texas, appeared to be back in the buying game, reports Mario Villarreal (mvillarreal@usdataworks.com), president and COO of Houston-based US Dataworks, Inc. (www.usdataworks.com). As evidence, Villarreal pointed to the advertised 30 percent bump in attendance, better booth traffic, and the more substantive conversations with prospects compared to last year.
"After several years of sitting through vendor presentations and strategizing internally about enterprise payments, many of the organizations at AFP appeared ready to buy," Villarreal said. "Based on the conversations we had at AFP, I think we will see a significant number of enterprise payments deals close next year." Villarreal said banks, in particular, appeared interested in enterprise payments.
Two key factors are driving the demand for enterprise payments, Villarreal said. First, operations have reached the breaking point in terms of effectively managing their existing payment silos. By consolidating all of their paper-based and electronic payment channels onto a single platform, organizations can reduce cost, eliminate redundant systems and processes, improve availability, gain better visibility into their payments, and apply consistent controls across their payment streams.
Second, organizations are more confident that they will have the budget necessary next year to kick-off an enterprise payments initiative. Furthermore, banks may be looking to make internal investments that deliver a reasonable rate of return rather than parking their cash and earning a measly 25 basis points, Villarreal said. "By no means are operations flush with cash, but IT budget dollars are loosening up for projects with a clear ROI, and enterprise payments fit that bill," he said.
What do you think?
Showing posts with label enterprise payments hubs. Show all posts
Showing posts with label enterprise payments hubs. Show all posts
Monday, November 15, 2010
Tuesday, September 14, 2010
4 Reasons Government Entities may adopt Integrated Payments Hubs
Posted by Mark Brousseau
If you think your operations budgets are tight, try managing payments processing for a government entity. Badly stung by declining tax revenues, most state, county and municipal governments have squeezed their operations budgets dry. And it couldn't have come at a worse time for government operations managers: like their counterparts in the private sector, governments are struggling with how best to adapt their operations to declining check volumes and emerging payments channels.
Leilani Doyle (ldoyle@usdataworks.com), product manager at Houston-based US Dataworks (www.usdataworks.com), believes government entities may find a solution in so-called enterprise payments hubs (or integrated payments hubs), which consolidate paper-based and electronic payments into a single platform, in turn, streamlining processing and eliminating operations silos.
About one-quarter (22.2 percent) of all government entities that responded to a recent IAPP-TAWPI survey indicated that they have implemented an enterprise payments hub to consolidate paper and electronic payments. The responses from state revenue agencies nearly mirror the overall findings for this question, with 21.4 percent indicating that they have implemented an enterprise payments hub. Non-revenue state agencies and county government entities have made a little more progress in this area, with 33 percent of (non-revenue) state agencies indicating that they have implemented an enterprise payments hub, and 40 percent of county government entities (by far the highest adoption rate among the groups tracked) stating that they have implemented an enterprise payments hub.
Doyle says 4 factors could drive faster growth of enterprise payments hubs among governments:
1. Declining paper volumes. As government agencies achieve success with electronic payments, their existing paper-centric infrastructure becomes obsolete. "Paper will not go away any time soon, but there's no need to maintain equipment and applications designed to manage large volumes of paper payments," Doyle explains. "Moving forward, government entities will need an integrated payments platform that can scale up or down as needed. This type of payments processing platform operates like a utility that can be easily adjusted to changing payment types and volumes."
2. Focus on serving constituents. Implementing an integrated payments hub enables government entities to provide better service to their constituents, Doyle explains. Research can be performed from a single location. Posting is more accurate. And check images can be retrieved instantly.
3. Push to reduce bank fees and operations costs. With an integrated payments hub, government entities can consolidate their bank deposit files, putting them in a stronger position for negotiating bank fees. Inside government operations, an integrated payments hub helps government entities increase overall staff productivity by not requiring them to learn different applications for processing each payment type. Similarly, reports for staffing and efficiency can be produced from a single system, streamlining the generation of Key Performance Indicators each agency must produce.
4. Lower capital expenditures and ongoing costs. With the emergence of enterprise payments solutions that offer a Software-as-a-Service (SaaS) or hosted delivery model, government agencies can replace their aging systems with little to no upfront cost. This is a creative way to allow agencies without the budgeted dollars to replace antiquated legacy systems, Doyle says. "SaaS services also provide an added layer of security and compliance protection, starting with PCI compliance and SAS-70. This can significantly reduce risks and audit costs for government agencies." What’s more, leveraging a SaaS or hosted delivery model means government entities can offload the management of their IT infrastructure. This not only saves money, but also allows government entities to better focus on their core competency -- serving taxpayers. And this may be the biggest benefit of all.
It's for these reasons that Doyle thinks government entities may adopt integrated payments hubs.
What do you think?
If you think your operations budgets are tight, try managing payments processing for a government entity. Badly stung by declining tax revenues, most state, county and municipal governments have squeezed their operations budgets dry. And it couldn't have come at a worse time for government operations managers: like their counterparts in the private sector, governments are struggling with how best to adapt their operations to declining check volumes and emerging payments channels.
Leilani Doyle (ldoyle@usdataworks.com), product manager at Houston-based US Dataworks (www.usdataworks.com), believes government entities may find a solution in so-called enterprise payments hubs (or integrated payments hubs), which consolidate paper-based and electronic payments into a single platform, in turn, streamlining processing and eliminating operations silos.
About one-quarter (22.2 percent) of all government entities that responded to a recent IAPP-TAWPI survey indicated that they have implemented an enterprise payments hub to consolidate paper and electronic payments. The responses from state revenue agencies nearly mirror the overall findings for this question, with 21.4 percent indicating that they have implemented an enterprise payments hub. Non-revenue state agencies and county government entities have made a little more progress in this area, with 33 percent of (non-revenue) state agencies indicating that they have implemented an enterprise payments hub, and 40 percent of county government entities (by far the highest adoption rate among the groups tracked) stating that they have implemented an enterprise payments hub.
Doyle says 4 factors could drive faster growth of enterprise payments hubs among governments:
1. Declining paper volumes. As government agencies achieve success with electronic payments, their existing paper-centric infrastructure becomes obsolete. "Paper will not go away any time soon, but there's no need to maintain equipment and applications designed to manage large volumes of paper payments," Doyle explains. "Moving forward, government entities will need an integrated payments platform that can scale up or down as needed. This type of payments processing platform operates like a utility that can be easily adjusted to changing payment types and volumes."
2. Focus on serving constituents. Implementing an integrated payments hub enables government entities to provide better service to their constituents, Doyle explains. Research can be performed from a single location. Posting is more accurate. And check images can be retrieved instantly.
3. Push to reduce bank fees and operations costs. With an integrated payments hub, government entities can consolidate their bank deposit files, putting them in a stronger position for negotiating bank fees. Inside government operations, an integrated payments hub helps government entities increase overall staff productivity by not requiring them to learn different applications for processing each payment type. Similarly, reports for staffing and efficiency can be produced from a single system, streamlining the generation of Key Performance Indicators each agency must produce.
4. Lower capital expenditures and ongoing costs. With the emergence of enterprise payments solutions that offer a Software-as-a-Service (SaaS) or hosted delivery model, government agencies can replace their aging systems with little to no upfront cost. This is a creative way to allow agencies without the budgeted dollars to replace antiquated legacy systems, Doyle says. "SaaS services also provide an added layer of security and compliance protection, starting with PCI compliance and SAS-70. This can significantly reduce risks and audit costs for government agencies." What’s more, leveraging a SaaS or hosted delivery model means government entities can offload the management of their IT infrastructure. This not only saves money, but also allows government entities to better focus on their core competency -- serving taxpayers. And this may be the biggest benefit of all.
It's for these reasons that Doyle thinks government entities may adopt integrated payments hubs.
What do you think?
Tuesday, December 15, 2009
NACHA Rule Strengthens Need for Payments Hub
Posted by Mark Brousseau
NACHA's proposed rule change for mobile payments provides a wake-up call for banks and billers unconvinced of the need for an Enterprise Payments Hub. Leilani Doyle (ldoyle@usdataworks.com) of US Dataworks (www.usdataworks.com) explains:
A proposed NACHA rule change for mobile payments is another nudge for banks and billers that have been reluctant to deal with the stark realities of the increasingly diverse payments environment.
The proposed rule change would expand the definition of Internet-Initiated Entries (WEB) to include ACH debits authorized and/or initiated via mobile/wireless networks, and require that those payments utilize the WEB Standard Entry Class (SEC) code. The rule change would cover payments made with a mobile device such as a smart phone, cell phone, and/or PDA, where the payment is transmitted via a wireless network. NACHA just concluded a request for comments on the change.
Expanding the WEB SEC code to include mobile payments is a reasonable idea.
NACHA says the rule change would clarify the entry classification for mobile payments over the ACH Network, and provide a framework for risk management and security, including authentication and authorization. While current NACHA rules don't specifically address mobile payments, many companies are either originating these payments over the ACH Network, or planning to in the future.
The NACHA proposal comes at a time when mobile payments are poised to grow. Insight Research Corporation estimates that 2.2 billion consumers will generate $124 billion in mobile financial transactions by 2014. More conservatively, Mercator Advisory Group estimates that payments from remote devices will grow from an estimated $389 million in 2009 to $8.9 billion in 2014.
A Better Solution
Regardless of how fast you believe mobile payments will grow, the NACHA rule change for mobile payments shines a bright light on a subject that is vexing many banks and billers: how to deal with yet another distinct delivery channel for payments with its own unique characteristics. Banks and billers must balance the need to mitigate the risks of each payment channel with the desire to remain flexible and avoid creating new silos, which, in turn, stifle agility and customer responsiveness.
To be sure, as mobile payments volumes rise, the channel will bring its own set of systems and process challenges, and be subject to fraud and attack -- regardless of the NACHA rule change.
That's true of all of the emerging payment channels.
The solution lies in utilizing an Enterprise Payments Hub to provide a single platform for processing all paper-based and electronic payments (including mobile), regardless of clearing channels.
An Enterprise Payments Hub provides a consolidated, end-to-end transaction processing platform that offers integration with legacy payments and receivables systems and processes. Management of all payment channels, including lockbox, mobile/wireless, Web bill payments, and over-the-counter work, is controlled through a single enterprise platform. An Enterprise Payments Hub is capable of managing the entire payments lifecycle including payments processing, check processing, retail processing, payments decisioning, and returns management. Incoming payments are cleared using Check 21 and ARC conversion for conventional remittance or lockbox processing, while other forms of bill payment and retail work is processed using the appropriate NACHA SEC code ( i.e. ARC, POP, RCK, TEL, WEB, PPD, CCD and BOC). Credit card and debit card payments are also processed through the platform for a fully integrated accounts receivable (AR) process.
An Enterprise Payments Hub is especially effective when the multiple payments channels of an organization are centralized, as standalone systems and processes can be significantly reduced. For example, an Enterprise Payments Hub can enhance workflow and data management, and facilitate common processes and administration across all payment channels. This functionality eliminates manual processes, accelerates exceptions handling, increases corporate agility, and improves float.
These capabilities also provide a platform for straight-through-processing (STP).
The Bottom Line
While the United States lags behind many industrialized countries in the adoption of mobile payments, there is no question that banks and billers need to be prepared for the channel's inevitable growth. The sooner organizations can develop a framework for mobile payments usage and risk, the better positioned they will be when the channel explodes. NACHA should be applauded for providing some level of regulatory guidance on payments that originate from mobile devices.
But the proposed NACHA rule change is only one piece of the emerging puzzle.
To optimize their payments processing and risk management, banks and billers must bring all of their payments channels -- including mobile/wireless -- together in an Enterprise Payments Hub.
What do you think? Post your comments below.
NACHA's proposed rule change for mobile payments provides a wake-up call for banks and billers unconvinced of the need for an Enterprise Payments Hub. Leilani Doyle (ldoyle@usdataworks.com) of US Dataworks (www.usdataworks.com) explains:
A proposed NACHA rule change for mobile payments is another nudge for banks and billers that have been reluctant to deal with the stark realities of the increasingly diverse payments environment.
The proposed rule change would expand the definition of Internet-Initiated Entries (WEB) to include ACH debits authorized and/or initiated via mobile/wireless networks, and require that those payments utilize the WEB Standard Entry Class (SEC) code. The rule change would cover payments made with a mobile device such as a smart phone, cell phone, and/or PDA, where the payment is transmitted via a wireless network. NACHA just concluded a request for comments on the change.
Expanding the WEB SEC code to include mobile payments is a reasonable idea.
NACHA says the rule change would clarify the entry classification for mobile payments over the ACH Network, and provide a framework for risk management and security, including authentication and authorization. While current NACHA rules don't specifically address mobile payments, many companies are either originating these payments over the ACH Network, or planning to in the future.
The NACHA proposal comes at a time when mobile payments are poised to grow. Insight Research Corporation estimates that 2.2 billion consumers will generate $124 billion in mobile financial transactions by 2014. More conservatively, Mercator Advisory Group estimates that payments from remote devices will grow from an estimated $389 million in 2009 to $8.9 billion in 2014.
A Better Solution
Regardless of how fast you believe mobile payments will grow, the NACHA rule change for mobile payments shines a bright light on a subject that is vexing many banks and billers: how to deal with yet another distinct delivery channel for payments with its own unique characteristics. Banks and billers must balance the need to mitigate the risks of each payment channel with the desire to remain flexible and avoid creating new silos, which, in turn, stifle agility and customer responsiveness.
To be sure, as mobile payments volumes rise, the channel will bring its own set of systems and process challenges, and be subject to fraud and attack -- regardless of the NACHA rule change.
That's true of all of the emerging payment channels.
The solution lies in utilizing an Enterprise Payments Hub to provide a single platform for processing all paper-based and electronic payments (including mobile), regardless of clearing channels.
An Enterprise Payments Hub provides a consolidated, end-to-end transaction processing platform that offers integration with legacy payments and receivables systems and processes. Management of all payment channels, including lockbox, mobile/wireless, Web bill payments, and over-the-counter work, is controlled through a single enterprise platform. An Enterprise Payments Hub is capable of managing the entire payments lifecycle including payments processing, check processing, retail processing, payments decisioning, and returns management. Incoming payments are cleared using Check 21 and ARC conversion for conventional remittance or lockbox processing, while other forms of bill payment and retail work is processed using the appropriate NACHA SEC code ( i.e. ARC, POP, RCK, TEL, WEB, PPD, CCD and BOC). Credit card and debit card payments are also processed through the platform for a fully integrated accounts receivable (AR) process.
An Enterprise Payments Hub is especially effective when the multiple payments channels of an organization are centralized, as standalone systems and processes can be significantly reduced. For example, an Enterprise Payments Hub can enhance workflow and data management, and facilitate common processes and administration across all payment channels. This functionality eliminates manual processes, accelerates exceptions handling, increases corporate agility, and improves float.
These capabilities also provide a platform for straight-through-processing (STP).
The Bottom Line
While the United States lags behind many industrialized countries in the adoption of mobile payments, there is no question that banks and billers need to be prepared for the channel's inevitable growth. The sooner organizations can develop a framework for mobile payments usage and risk, the better positioned they will be when the channel explodes. NACHA should be applauded for providing some level of regulatory guidance on payments that originate from mobile devices.
But the proposed NACHA rule change is only one piece of the emerging puzzle.
To optimize their payments processing and risk management, banks and billers must bring all of their payments channels -- including mobile/wireless -- together in an Enterprise Payments Hub.
What do you think? Post your comments below.
Wednesday, November 25, 2009
Enterprise Payments Hubs Attracting Interest
By Mark Brousseau
Challenged by new regulations, the overhead and inefficiencies of siloed payments systems, and fast-rising unit costs for paper-based transactions, more billers and banks are taking a hard look at so-called Enterprise Payments Hubs -- solutions that enable the end-to-end processing of any paper-based or electronic payments or clearing channel.
Twenty-percent of participants on a recent US Dataworks (www.usdataworks.com) Webinar stated that they plan to implement an Enterprise Payments solution in the next six to 12 months, while 25 percent of the Webinar participants stated that they plan to implement an Enterprise Payments solution in 12 to 24 months. Ten percent of the Webinar participants said they already have implemented an Enterprise Payments solution. The survey respondents included billers and financial institutions.
Backing up their plans, 25 percent of participants on the US Dataworks Webinar said they already have researched Enterprise Payments solutions.
So why the rising interest in Enterprise Payments solutions? Webinar participants cited high unit costs for transaction processing (30 percent) and the inability of their legacy systems to adapt to new payment types (15 percent) as their two biggest challenges with traditional standalone payment systems.
What do you think?
Challenged by new regulations, the overhead and inefficiencies of siloed payments systems, and fast-rising unit costs for paper-based transactions, more billers and banks are taking a hard look at so-called Enterprise Payments Hubs -- solutions that enable the end-to-end processing of any paper-based or electronic payments or clearing channel.
Twenty-percent of participants on a recent US Dataworks (www.usdataworks.com) Webinar stated that they plan to implement an Enterprise Payments solution in the next six to 12 months, while 25 percent of the Webinar participants stated that they plan to implement an Enterprise Payments solution in 12 to 24 months. Ten percent of the Webinar participants said they already have implemented an Enterprise Payments solution. The survey respondents included billers and financial institutions.
Backing up their plans, 25 percent of participants on the US Dataworks Webinar said they already have researched Enterprise Payments solutions.
So why the rising interest in Enterprise Payments solutions? Webinar participants cited high unit costs for transaction processing (30 percent) and the inability of their legacy systems to adapt to new payment types (15 percent) as their two biggest challenges with traditional standalone payment systems.
What do you think?
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