When making the transition to digital payments, most companies also add systems for detecting fraud to the mix.
Fifty-nine percent of them are now relying on advanced technologies to stop fraud, according to “Business Payments Digitization,” a PYMNTS and Corcentric collaboration based on a survey of 400 chief financial officers (CFOs).
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The types of fraud detection systems companies have implemented include data mining (installed by 68% of respondents), deep learning and neural networks (installed by 59%) and rules-based algorithms (installed by 38%).
Fraud Prevention Is a Growing Corporate Priority
Firms of all sizes benefit from the anti-fraud advantages digitization offers, Corcentric President and Chief Operating Officer Matt Clark told PYMNTS in an interview. Preventing fraud has become a top priority for companies, and new tools can make digital record keeping, verification and authentication easier and safer.
Read more: Peeling Back the Digital Payments ‘Onion’ Is Critical to Maximizing Cash Flow
The largest companies have invested most aggressively in anti-fraud systems. Seventy-five percent of companies that generate $1.5 billion to $2 billion in annual revenue implemented anti-fraud systems when they digitized their payment processes.
Smaller companies are also making a commitment, albeit to a lesser extent. Fifty-nine percent of companies generating $1 billion to $1.5 billion in annual sales, 50% of companies generating $750 million to $1 billion in annual sales and 51% of companies generating $400 million to $750 million in annual sales installed anti-fraud systems as they digitized their payments operations.
Digitization Helps Combat Fraud
Finance and insurance companies have led the way in the space. Ninety-four percent of them implemented fraud detection systems as part of their digitization efforts, as did 60% of travel and transportation companies, 49% of retail trade businesses, 46% of healthcare and medical companies, and 45% of industrial and manufacturing firms.
Businesses in each of the five industries surveyed also reported that digitization helped their efforts to combat payment fraud. A notable 83% of CFOs at finance and insurance companies said payments process digitization led to improvements in their firms’ ability to minimize payments fraud, as did 66% of CFOs in retail trade, 63% of those in travel and transportation, 58% of those in healthcare and medical, and 51% of those in industrial and manufacturing.
Protection Against Fraud Is One of Many Benefits
PYMNTS’ research found that CFOs who have implemented digitized payments processes confidently said they are reaping benefits that include better balance sheet management, better control of accounts receivable (AR) and accounts payable (AP) processes and better supervision of investments in assets.
Many CFOs said payments digitization is “very” or “extremely” important for improving the management of their balance sheets. They also saw it as a way to help transform how their companies run and reposition themselves to strengthen their ties with customers and suppliers.
Other important benefits they are realizing include better data security and stronger protection against payments fraud.