Sid Vasili CEO of Invapay tells Finance Monthly about the current trends in payment technology.

Invapay helps CFO and CEOs improve payments and working capital management. Invapay is connected to over 800 banks. Do you think we are reaching an age where payment technology will become completely essential? Completely essential is a very strong term. The way I look at it is this. You want an organisation operating to its maximum potential. The new payment technology available can do a number of things which help CEOs and CFOs increase profitability and efficiency. Companies which don’t innovate are essentially steering their organisation into a slow and steady decline. There are lots of examples where a lack of well thought out investment and innovation has taken the company into decline. The retail sector is littered with organisations which buried their head in the sand in the face of the Internet. No strategy to adapt. No plan to evolve. Just squabbling amongst executives as their indecision took them slowly towards a point of no return. At this moment there is one simple truth about the way corporations manage B2B payments and it is this...we are undergoing the largest revolution in the way business to business transactions occur. Those which don’t adapt soon will face a major drain on their working capital which will have long-term implications. Is it completely essential? Yes. Will it remove risk and make them more profitable? Yes. Lots of companies are benefiting and I think it will become the norm. Which continent leads the way with payment technology currently? Is there anything Europe can learn from other continents? We have a presence in Europe, North America and Asia Pacific. From my experience, I would say that APAC are quicker at adopting new ways of working. I read a report recently which interviewed 1700 finance professionals in the accounts receivables space and the results were very interesting. In Asia, more than one in three cited “maintenance of adequate cash flow” as the main threat to business profitability. In America and Europe the study showed that the same question scored lower, illustrating that cash flow management is a key focus in Asia. I think that APAC is more proactive at looking for ways to improve cash management. However, I think there’s probably more to it than that. Many of the organisations I talked to in the APAC region were running very traditional operations and they have identified the need to increase capability. They are, generally speaking, slightly behind the Europeans and Americans in their processing but have taken the strategic decision to catch up and get ahead quickly. I would predict that over the next few years APAC will lead the way in working capital management. They need to develop business cases and get sign-off through layers of executive management which can be a long process without a guarantee of success. With cloud-based technology they can provide a bespoke solution to their client’s problem and deploy very rapidly without the capital expenditure. Why invest in hardware when you can have an off the shelf solution that avoids all of that? We help them to fill the gaps in their proposition and can make, for example, their purchasing card programme more efficient and add incremental products to their cash management solutions. The customers and the banks all benefit. One of the big barriers to new innovation in corporates is the cost and time involved in infrastructure projects. Cloud-based technology means there is no hardware cost and implementation is quick and efficient. Like many cloud-based systems we can have it operating for a client within a day. What are the barriers to adopting new technology? I think the largest barrier is procrastination amongst decision makers and the main reason for that is fear of making the wrong decision. We’ve all been through a tough time and people are battle-scarred from the experience. However, our staff spend a lot of time working with people that are looking to improve the payment and procurement process and we advise them on the best approach. SPOTLIGHT ON... Sid Vasili, CEO of Invapay Payment Technology You help your champion map a strategy to address, overcome and get round the barriers. It’s usually hard and patient work but if you don’t invest in it your ambitions and good intentions are about as much use as a chocolate teapot. Yet, indecision remains. I have been speaking to one company, on and off, for about six years. They have had changes in management, concerns about the recession and can’t decide whether it’s the right thing to do. The impact of changing the way working capital is managed can yield immense results on profitability. And yet this procrastination, and the long decision making process, can stop the very projects which can save time, money, and jobs. You have to find a champion in the organisation. You sit down with them and work through the obstacles they need to overcome to get a hearing. These are usually political - someone somewhere stands to lose power or a treasured process. You offer companies the ability to manage payments with minimal or no administrative overhead. Is this something that companies are increasingly looking to streamline? All companies have good intentions about streamlining their processing but executives don’t seem to prioritise it. I read a KPMG report which analysed the strategic planning of top US executives in the Food and Beverage industry. They were asked “what initiative do you expect to undertake over the next year that will consume the most time, energy and resources, from a management perspective?” You’ve been a big campaigner for early settlement between companies for many years. How can payment technology help working capital management and cashflow? The card schemes (Visa, American Express, MasterCard and others) now provide innovative B2B alternatives. The issuers of these products offer credit facilities on what they call a “fifteen or sixteen digit account” with lots of flexibility packed in. For those familiar with their propositions they will know it provides an easy way to extend credit terms. Essentially, the account enables the purchaser to stretch terms by up to 28 days. It’s an ideal way to extend credit whilst ensuring suppliers are happy. And there are other benefits, too. The providers of the accounts can offer financial rebates on your spend which goes straight to the bottom line of your business. Finally, the transactions are extremely rich in data. This data can be passed directly into your systems which removes the manual effort required in reconciling month end, expenses and tax returns. Invapay has recently signed global partnerships with Barclays Dubai and VISA in Asia Pacific. How receptive are big banks to cloud-based payment technology? Very receptive. They see it as a useful addition to their portfolio of products. Many banks know that gaining investment for new projects internally can take time. "We are undergoing the largest revolution in the way B2B transactions occur“ However, only 5% of respondents were going to devote time to “changes in financial processes and related technology.” When you think that most of these people get measured on the profitability of their operation there’s a concern. Many of these projects don’t catch the eye in the boardroom or seem exciting enough. Also, people conjure up an image of long-drawn out meetings, project plans and energy sapping delivery schedules when they hear ‘technology project.’ But the world has moved on. Deployment of new solutions is quick and simple and can be operating in days, not weeks. The solution is built to do the job rather than dazzle people with bright charts which never get used. It’s functional, user-friendly and above all helps CFO’s/Treasury save the company money through improvements in working capital management. What size is your typical client? Are smaller companies also embracing cloud payments? It’s not really a question of size but more a question of appetite to improve working capital. We have a range of companies from SMEs to global multinationals and we also work with the UK and Dubai Governments. They all have two things in common. The first is that they want to improve their profitability. We can help them achieve their goals. The second is that they want to reduce the time it takes in managing the procurement and payment process which we do by making it simpler and fully automated. The top answer was investment in organic growth at 21% which included new product development, pricing strategies and geographic expansion. Web: www.invapay.com Email: This email address is being protected from spambots. You need JavaScript enabled to view it. Tel: +44 (0)1992 500589