Cross border payments: how to improve security and reduce risk
- 22 Jun 2021
- Best Practice & Strategies
Over the past decade, online communication quickly fueled a global marketplace and economy, increasing the number of cross-border payments. Working in the cloud and making global payments digitally became the new normal ever since the need to work remotely during COVID-19.
Business leaders continue to be rightfully concerned about improving security and reducing the risk associated with cross-border payments. Learn how automation changes the way companies make global payments and strengthen security to support the global-minded C-suite.
Cross-border payment challenges
Despite the inevitable increasing popularity of cross-border payments, challenges still exist in payment processing. The limited transparency, high costs, limited access, and low speed associated with global payments prove manual AP processes are inefficient and costly for organizations.
The Bank for International Settlements (BIS), an international association for central banks, recently issued the report, Enhancing cross-border payments: building blocks of a global roadmap to make long-term improvements cross-border payments. The information was compiled by BIS’s Committee on Payments and Market Infrastructures (CPMI). According to the report, global payments setup can be costly, slow, unreliable, or even unavailable in some countries. The CPMI report also revealed cross-border payments are expected to increase from $20 trillion in 2019 to a significant $30 trillion by 2030.
Automation takes the typical complexity out of cross-border payments and offers greater transparency, reducing the risk of fraud and security breaches. Improving cross-border payment services support economic growth and global development, helping to increase profits for forward-minded companies. A robust AP automation and payments solution improves the domestic and international payment process.
The pandemic and global payments
The pandemic had an impact on cross-border payment flows and brought to light inefficiencies of the past. Companies dependent on manual processes scrambled to find automated solutions to support remote work during quarantining, especially for back-office operations such as accounts payable. Businesses that already partially or fully adopted AP automation and payment solutions were ahead of the curve.
Companies quickly discovered the cost of business disruption and sought business continuity through cloud automation. For example, the AP team could work in real-time, from any device or location, to seamlessly pay invoices on time and maintain strong supplier relationships. Many companies recognized their strategic weaknesses in their current global supply chains.
The value-chain shifts that began before COVID-19 will fuel the need for automation to examine current supplier relationships and explore new ones in a global marketplace. With multiple currencies and regulatory protocols, automated payment solutions take the complexity out of international payments. As a result, acts of fraud and security risks are quickly and easily identified before they become costly problems.
Reinventing cross-border payments
With a global economy and post-pandemic challenges in mind, reinventing cross-border payments is crucial to remain profitable and productive. AP automation with payment automation provides a singular, simple process to pay international suppliers in multiple currencies. Unlike most other APA and payment automation solutions, Medius Pay ensures cross-border payments are sent the same day with no wire fees, cutting costs and saving time. International payments are sent through a global network of local bank accounts with confirmed receipt of payment on the same day.
With cloud AP automation, one interface is used to make domestic and cross-border payments in real-time. The AP team and C-suite have the latest financial updates at their fingertips, regardless of time or location. An electronic invoice-to-pay process removes time-consuming and costly manual steps and takes control of security, audits, and payment approvals. Getting rid of manual processes also eliminates costly human errors and security breaches that impact a company’s reputation and profit margin.
One of the most significant benefits of adopting AP automation and payments solutions is reducing the administrative time spent recording invoices on multiple platforms and reconciling payments. The AP team emerges from the back office to become an integral part of the financial and management teams, negotiating discounts for early payments and examining supplier relationships' value.
Maintaining security is crucial to avoid expensive losses of profits and reputation. Automated solutions provide real-time updates to stay ahead of security challenges as they arise. As cross-border payments become the wave of the future in a growing global marketplace, AP automation and payments solutions are a necessary investment. Combining AP automation with payment automation can generate significant savings through rebates and discounts, helping companies realize a fast ROI on their automation investment.