‘Seeing Is Believing’ for Corp Clients When It Comes to Cash Flow and Liquidity

Aware of the need for modernization, most financial institutions (FIs) are innovating or planning to innovate new digital solutions to reduce their enterprise clients’ key B2B payments frictions.

At the top of their current agenda is offering their clients a single view of cash for real-time cash flow management and forecasting. Fifty-five percent of FIs are currently working to find solutions that will do that, and another 24% plan to work on such a solution, according to “The Innovation Gap,” a PYMTNS and FIS collaboration.

Get the report: The Innovation Gap

This is both a top digital B2B payment friction that businesses are experiencing and one of the areas in which FIs struggle to offer corporate clients digital payment solutions.

Capturing the Full Benefit From Digitizing Solutions

Twenty-six percent of FIs said real-time cash flow management is a problem area for their corporate clients when paying their suppliers, and 7% said it is the most important problem.

At the same time, only 26% of FIs said they currently offer this digital solution to their corporate clients.

There are many opportunities for FIs and corporations to leverage common integrated accounts receivable (AR), accounts payable (AP) and cash management and treasury solutions with common integration points and cross-functional visibility, Mike Kresse, head of business payments and card and money movement at FIS, told PYMNTS when interviewed for the report.

It’s important to choose solutions that talk to each other, Kresse added, because truly streamlining payments requires making complementary changes to both the way you are paying and the way you are being paid.

“The cross-functional ‘full liquidity visibility’ is where the real value happens, and if you can’t get that view in one place, then you’ll fail to capture the full benefit from digitizing solutions,” Kresse said.

Customizing the Range of Payment Processes

FIs must maintain the flexibility necessary to customize the range of payment processes offered to clients as their businesses grow.

Norm Marraccini, senior vice president and head of commercial and retail solutions at FIS, told PYMNTS in an interview that he expects to see an end to the current bifurcation between payables and receivables. The solution would include a one-stop shop for businesses that features payables and receivables in the same portal, the same user experience, the same look and feel, and the same ability to drive efficiency.

Read more: Suppliers and Buyers Want Consumerized B2B Payments

PYMNTS’ research makes it clear that FIs need to focus on four specific innovation areas to better address clients’ B2B pain points.

They must offer a centralized view of cash flow and liquidity, streamline business user authentications, simplify invoice reconciliation and deploy speedier supplier and vendor onboarding tools that can rapidly scale with the addition of new businesses.

In some cases, both FIs and their corporate clients can benefit from working with technology solutions providers to identify and address these payment frictions.