Transaction banks hold the keys to moving purchase-to-pay (P2P) automation to the next phase of development, according to some market participants. And the developments that are now in the works (some of which you can find more information on in previous blogs here and here ) could radically alter the landscape for corporate P2P management.
But not all transaction banks are convinced that getting involved in P2P enabling is a good value proposition for them.
Those that are convinced—and have already begun work on bringing together disparate pieces of the P2P cycle—will be well-positioned to lead the market and further integrate themselves within corporate financial supply chains.
There are three key reasons why it is essential that banks be involved in advancing P2P market maturity. The first is the need to get a critical mass of small-and-medium-sized (SME) suppliers on board with e-invoicing and other P2P solutions.
Notes Garry Young, Director of SaaS and Corporate Service at technology vendor Logica: “Banks are ideally placed to solve the SME challenge. They have relationships with hundreds of thousands of SME customers and talk to them often on a daily basis.”
The second—which is true not only from a corporate user perspective but also from a regulator’s or legislator’s perspective--is the need for a trusted partner to overlay any kind of solution involving cross-border payments, and multi-country P2P offerings are without doubt where the market must go to make any kind of sense for larger corporate uptake.
Finally, banks are essential in driving integration of technologies around the disparate pieces of the P2P cycle-from requisition to receipt, and from payment to accounting.
Some of the biggest transaction banks are pushing boundaries when it comes to integrating P2P processes, and are working to make it easier and more appealing for their SME clients to get on board.
Those that do not yet see the value proposition of spending time and resources on this could find their corporate clients defecting to more visionary banks once their P2P advances take off.