In the wake of the “2018 U.K. Business Payments Barometer,” I can’t help but reflect on the future of UK business payments in relation to my many years in the industry. Things are certainly not the same as they were a decade ago — or even 2-3 years ago for that matter. A number of major factors are now at play that will have a significant impact on the ability of organisations to separate themselves from the pack and use technology to achieve true competitive differentiation.
Based on my experience, here is the advice I would offer to organisations – of all sizes and across all industries – looking to forge significant, lasting change in the coming year.
LIVE UP TO THE SPIRIT OF PROMPT PAYMENTS
There is simply no excuse for large companies and corporates to purposefully delay payment to protect their own cashflow. The introduction of the Prompt Payment Code and Duty to Report reinforce the fact that slow payment has a material impact on small businesses – the lifeblood of our economy.
Honouring the spirit of prompt payments builds trust and more fruitful business relationships, helping our economy to thrive.
SIMPLIFY COMPLIANCE WITH AUTOMATION
Cyber security brings with it potential problems around new areas of cost and compliance, such as SWIFT’s announcement last year that all members, including corporates, must meet a set standard of security.
These kinds of mandatory or advisory changes can be a source of frustration for companies forced to spend time and money to comply with additional requirements, as well as the struggle they must undergo to understand the regulatory detail as they ensure resilience around their payment systems.
It’s a growing burden that’s not likely to change for financial decision makers.
Thankfully, it doesn’t need to be a painful one. By investing in the right technology and automation, compliance can become a simple affair and even translate into potentially tangible benefits.
ADDRESS THE THREAT OF INTERNAL PAYMENT FRAUD HEAD ON
“Internal fraud” is often seen as two dirty words that people in business fear and often avoid mentioning. Yet, as we’ve seen from the UK Business Payments Barometer there is a very real concern amongst financial decision makers around fraud committed within the organisation – a 169% increase in the past two years alone.
Internal fraud needs to be taken as seriously as external fraud when it comes to technology investment and updates in processes. Executives cannot continue to bury their heads in the sand and expect the issue to go away. Instead, financial decision makers, alongside IT, HR and Audit teams, need to come together to identify a comprehensive cyber-fraud and risk management strategy that takes into account all the new threat vectors present in today’s payments landscape.
For more thoughts about the future of UK business payments, including guidance on how to embrace the benefits of Open Banking and PSD2 and deal with the impact of Brexit, view the full “2018 UK Business Payments Barometer.”