Posted by Mark Brousseau
Rising payment processing costs may be catching up to utilities, if this week’s 13th Annual Utility Payment Conference hosted by Dominion at the Hilton Hotel in Richmond, VA, is any indication.
Historically, utility payments were among the easiest and cheapest to process, thanks in large part to the high number of full-pay transactions that included a remittance document with an OCR scan line. In fact, TAWPI’s 2009 Payments Benchmarking Survey showed that the average cost per paper-based remittance payment remained unchanged at $0.15 per item between 2005 and 2009. But the emergence of new payment channels, such as the Web and credit card, has disproportionately “taken out” so-called “clean” transactions, leaving utilities with more complex paper-based remittances. At the same time, utilities must cost-effectively manage this growing number of payment streams.
Not surprisingly, utilities in attendance at this week’s payments conference were keen on finding solutions that would consolidate both paper-based and electronic payment streams onto a single platform. Mario Villarreal, president and COO of US Dataworks, Inc. – an exhibitor at the event – can’t remember a time when utilities have shown as much interest in enterprise payments solutions.
This follows a trend I observed this summer at the Federation of Tax Administrators conference.
“The utility market is clearly thirsting for enterprise payments solutions that provide them with greater visibility, efficiency and consistency in their revenue management,” Villarreal explained.
For utilities, centralized processing is one of the key advantages of an enterprise payments approach. Villarreal says centralized payments processing is especially appealing to utilities that are expanding their geographic footprint; one utility he spoke with at the conference operates in 33 states. With an enterprise approach, utilities gain better visibility into their payments, regardless of their footprint.
Utilities see similar benefits to centralizing the archival of their payments images and data, he adds.
But vendors may be slow in getting the message, Villarreal added. “Most of the exhibitors at the conference are still taking a fragmented approach to automated utility payment processing.” The vast majority of the 38 exhibitors at the Payment Utility Conference strictly offer siloed solutions for payments applications such as remittance, cashiering, remote deposit capture or ACH processing.
In Villarreal’s eyes, that won’t solve the challenge utilities face in their payments operations.
“Until you consolidate systems and apply standard processes and controls across payment channels, you will always be saddled with inefficient and costly payments operations,” Villarreal concluded.
What do you think?
Showing posts with label integrated payments hub. Show all posts
Showing posts with label integrated payments hub. Show all posts
Friday, October 22, 2010
Monday, April 26, 2010
TAWPI @ NACHA Payments
Posted by Mark Brousseau
The meshing between accounts payable and accounts receivable and different payment types and mechanisms is going to be this decade’s focus when it comes to payments innovation and standards, Aaron Bills, COO and founder, 3Delta Systems, told me this morning at NACHA’s Payments 2010.
“There is an evolution and maturing occurring in purchasing as a strategic function,” Bills said. “We’re finally working back from the manufacturing supply chain to the financial supply chain.”
“The fewer fingerprints we can leave on the transaction, the less costly it is to process,” Bills said. “We’ve had these different tracks where people have tried to solve similar payments problems. What the market needs is a localized, parameterized and database-driven payments infrastructure that supports multiple tenders, multiple nations, multiple parties, and multiple levels of security.”
That’s why 3Delta Systems is expanding beyond its purchasing card (p-card) roots to develop what Bills refers to as a “global payment infrastructure” – a centrally managed solution delivering a high degree of authentication and appropriate levels of control (such as PCI) across all payment types. “By having a platform that we can rapidly extend or adapt for different requirements, we can achieve success in an environment that is churning quickly and where the ‘right path’ hasn’t been defined.”
Bills said to think of it as an ‘intelligence switch.’
“The industry has a last mile wiring problem, where that are a lot of nice applications that need to be connected to a network,” Bill said. “The nightmare scenario for organizations is that they have a deluge of relationships and technologies that they have to manage; many-to-many. Our goal is to make it easier to manage that by providing a technology base where connections are streamlined.”
“There needs to be a consistent payments process that can be applied, regardless of the tender type,” Bills says. “A merchant simply cannot manage eight to 12 different business processes. It upsets the operational balance.”
Bills said his company’s new product will bring him into competition with card processors who are his channel partners today. But he’s up for the task. “The challenge the processors face is that their technology is very old – a lot of it is written in COBOL. The older technologies will make it harder for current channels to adapt to the rapidly changing client requirements, and that will create the opportunity for technology providers like us. Indeed, we may compete with some in the dynamic space, but it is also likely that the channels that relied on us for our B2B services will rely on us again during this wave of innovation.”
What do you think?
The meshing between accounts payable and accounts receivable and different payment types and mechanisms is going to be this decade’s focus when it comes to payments innovation and standards, Aaron Bills, COO and founder, 3Delta Systems, told me this morning at NACHA’s Payments 2010.
“There is an evolution and maturing occurring in purchasing as a strategic function,” Bills said. “We’re finally working back from the manufacturing supply chain to the financial supply chain.”
“The fewer fingerprints we can leave on the transaction, the less costly it is to process,” Bills said. “We’ve had these different tracks where people have tried to solve similar payments problems. What the market needs is a localized, parameterized and database-driven payments infrastructure that supports multiple tenders, multiple nations, multiple parties, and multiple levels of security.”
That’s why 3Delta Systems is expanding beyond its purchasing card (p-card) roots to develop what Bills refers to as a “global payment infrastructure” – a centrally managed solution delivering a high degree of authentication and appropriate levels of control (such as PCI) across all payment types. “By having a platform that we can rapidly extend or adapt for different requirements, we can achieve success in an environment that is churning quickly and where the ‘right path’ hasn’t been defined.”
Bills said to think of it as an ‘intelligence switch.’
“The industry has a last mile wiring problem, where that are a lot of nice applications that need to be connected to a network,” Bill said. “The nightmare scenario for organizations is that they have a deluge of relationships and technologies that they have to manage; many-to-many. Our goal is to make it easier to manage that by providing a technology base where connections are streamlined.”
“There needs to be a consistent payments process that can be applied, regardless of the tender type,” Bills says. “A merchant simply cannot manage eight to 12 different business processes. It upsets the operational balance.”
Bills said his company’s new product will bring him into competition with card processors who are his channel partners today. But he’s up for the task. “The challenge the processors face is that their technology is very old – a lot of it is written in COBOL. The older technologies will make it harder for current channels to adapt to the rapidly changing client requirements, and that will create the opportunity for technology providers like us. Indeed, we may compete with some in the dynamic space, but it is also likely that the channels that relied on us for our B2B services will rely on us again during this wave of innovation.”
What do you think?
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