B2B Payment Solutions
FinLync streamlines and centralizes business-to-business payments into one secure and visible process under treasury’s control. As an embedded application, FinLync leverages your existing ERP authorizations, reinforcing security. Real-time multi-bank API connectivity ensures instantaneous payment transactions that can be tracked as easily as a FedEx package.
Problem
B2B payment processing is compromised by complexity. Tracking payments is crucial for fulfilling obligations and preventing fraud. But most treasury teams struggle with fragmented systems, multiple file types and multiple connections, leaving them vulnerable to mistakes, fraud and delays.
Solution
A B2B payment solution that automates and streamlines workflows. Our ERP-native applications remove barriers, creating secure and on-demand direct connections to the banks via APIs for real-time payment initiation, greater visibility into payment statuses, and enabling automatic reconciliations that continuously improve through artificial intelligence.
Treasurer & Assistant Treasurer
Reduced vulnerability to fraud; greater confidence with seamless, secure payment processes
Treasury Team
Automatic same-day reconciliation reduces time to financial close; faster resolution of exceptions and discrepancies; artificial intelligence for continual process improvement
IT
Can focus exclusively on the ERP; no need to maintain multiple connections or systems
Process Comparison: Making Corporate Payments
Without FinLync
With FinLync
Without FinLync Step 1
Lengthy paper process to establish bank connections with third-party networks, H2H
With FinLync Step 1
Install FinLync application. Bank API connections are already prebuilt and pretested
Without FinLync Step 2
B2B Payments from multiple sources manually entered into ERP and legacy systems
With FinLync Step 2
B2B payment data leveraged from ERP is reflected in the apps, so no data or file transfer is required
Without FinLync Step 3
Manage duplicate signatories and B2B payment approval process in the ERP and the third-party system
With FinLync Step 3
Complete the payment approval process using FinLync apps. Leverage same authorization and B2B payment approval process already established in ERP
Without FinLync Step 4
Generate the payment files for approval
With FinLync Step 4
Payment information sent directly to bank via APIs. Users receive instant and ongoing feedback about B2B payment status
Without FinLync Step 5
Payment files stored in a folder to be sent via a third-party network or host-to-host
Without FinLync Step 6
Payment files processed through the networks
Without FinLync Step 7
File picked up by bank for payment execution
Without FinLync Step 8
Payment acknowledgments sent to client
More About B2B Payments
Payment methods for consumer payments are dramatically different than for B2B payments. When you manage many formats, systems and banks, B2B electronic payments must follow a tortuous path. In legacy systems, the flow moves from the company’s ERP to its treasury-management system (TMS) then routed via host-to-host channels to a number of different banks, each presenting opportunities for fraud and error and preventing proper visibility into transaction fees.
With legacy technology, companies must maintain separate sets of user access and payment-approval account signatory information for third-party systems, causing extra maintenance work as IT has to maintain separate systems while keeping an eye on access rights, and treasury manages signatory information to check and ensure they are consistent between the two.
Treasury is obligated to ensure that the person initiating a transaction is not the same person approving it. When approvals are fulfilled manually, the process involves numerous emails, printed papers and other documents that must be reviewed or signed. The process is not only inefficient and time-consuming, but also creates significant fraud risk, as there are more opportunities for corporate payment information to be manipulated. What’s more, treasury doesn’t have full visibility into transaction fees, especially for international payments.
Host-to-host connectivity carries a number of disadvantages.
Control. With host-to-host, the bank controls your data. They decide when it is sent and what data points are shared.
Stale data. Because bank files are sent on the bank’s schedule, not yours, the data is stale, and management does not often have the best information available.
Cumbersome manual work. Bank files require the bank and the corporate to perform at least six distinct tasks before a file can actually be used.
Slow or nonexistent traceability. Even after a laborious six-step process, there is still no confirmation that a payment has been sent successfully, or that it successfully arrived to the recipient. Every treasury team has felt the pain of the question “where’s the wire transfer?” It’s common to not receive an acknowledgement, leaving corporates in the dark, wondering if the bank actually got the file in the first place. And if a file needs to be re-sent, the company has to manually call or email the bank to request it.
Security. File-based connectivity – which includes the method through which wire transfers are sent – is vulnerable to fraud. Because host-to-host connections accept file formats of any type, there are no forced data or security standards, leaving it vulnerable to data manipulation or malware-injection attacks. And because the files are stored on file servers, at some point in the life of the file, an administrator will need access to it. Host-to-host connections separate the interface and the files, which means the data in that file could be manipulated before any encryption occurs.
Setting up a host-to-host connection is no easy task, so corporates often purchase a third-party system with prebuilt host-to-host connections. These third parties providers, such as b2b payments companies, payment solutions and b2b payment services, act as middlemen, cobbling together host-to-host connections that relay data onward to other host-to-host connections, SWIFT, or to the bank. This adds yet another insecure link in the connectivity chain, further increasing the security risk.
Costs. Host-to-host connectivity channels require a heavy setup, and file servers need ongoing maintenance. The interfaces of host-to-host channels often come with an extra charge to start working, or with mandates requiring use of their proprietary system. For those who decide to outsource host-to-host connectivity to a third party, additional time and money for purchasing and implementing the solution should be expected.
Although H2H is still widely used today in corporate finance, it will soon be rendered obsolete by the new, faster and more secure technology provided by bank APIs and the automation of payment systems that they enable – all of which are harbingers of digital transformation.
FinLync provides a streamlined and transparent payments workflow. Unlike any other payment solution or billing and invoicing software, our apps are embedded in the ERP, removing the need to transfer payments files. With FinLync, the payment information generated in the ERP is sent securely to your banks via prebuilt, pretested APIs and it automatically optimizes among different payment methods including ACH payments otherwise known as automated clearing house payments, wire transfers and online payments or digital payments, ultimately helping treasury better manage cash flow across bank accounts, and having a positive impact on other areas of finance like accounts payable, accounts receivable. Since there are no intermediary parties or processes, you always retain full transparency and get immediate feedback regarding payment status or fees all in real-time. FinLync also optimizes for the channel through which your business to business payment is sent – leveraging digital payments and RTP networks around the globe, ACH payments also known as automated clearing house payments, and other payment provider methods including wire transfer and electronic payments.
We build flexible payment workflows with multiple levels of approval into our applications, referencing the existing payment controls directly available in your ERP. Since there is no need to define and maintain separate workflows or user authorizations, a change in the underlying ERP master data will automatically apply to FinLync applications.
FinLync harmonizes nonstandard formats for you, across all bank APIs, to provide correct data-mapping and prevent file or payment errors.
In addition to direct connectivity and embedded workflows, FinLync applies artificial intelligence to daily reconciliations of B2B payments against the general ledger, helping treasury make faster month-end closes. Rejected payments are accompanied with reasons for the rejection, making exception-handling easier and faster to master.