What is payee management?

Payee management refers to the systematic process of handling and overseeing the individuals, businesses, or entities to whom a company or organization makes payments (also known as payees). These payees may include vendors, suppliers, contractors, employees, freelancers, or any other party that is due payment for goods, services, or other transactions. Effective payee management ensures that payments are made accurately, and on time; plus you know they’re in compliance with financial and regulatory standards. Key components of payee financial management include: Payee Account Data Collection and Maintenance Collecting and storing essential payee data, like their payee details, phone number, payee name, debit card (or other card payment), purchase order number, bank account (account number), payment preferences, contractual details, and other payee information. Ensuring that the payee data is regularly updated to reflect changes in address, banking details, or other critical information to avoid payment delays or errors. Payee Onboarding The process of registering a new payee into the system includes collecting necessary documentation for tax purposes, and verifying their identity and banking information. Compliance checks, such as verifying the payee’s status against watchlists, to ensure they can legally receive payments. Payment Method Selection Choosing the right payment method for each payee includes direct deposit, wire transfer, debit or credit cards, cheques, PayPal, or other digital payment platforms. Offering flexibility in payment methods to accommodate payee preferences while maintaining efficient processing. Compliance and Reporting All payments must comply with tax regulations, including withholding taxes when required, and appropriate forms must be issued. Maintaining a robust audit trail for all payments, ensuring transparency and accountability. Payment Processing Executing payments quickly, ensuring that each payee receives the correct amount without delays or errors. Monitoring payment status to ensure successful transfers and resolving payment issues, such as rejected or returned payments. Vendor and Supplier Relationship Management Managing relationships with vendors and suppliers by processing payments according to agreed-upon terms and schedules. Building trust and maintaining a good relationship with your list of payees through accurate and timely payments. Risk Management Identifying and mitigating risks associated with fraudulent payees or payment processing errors. Implementing controls ensures that only authorized and legitimate payees are added to the system and that the system will accept all payments that are properly approved.

How does automation improve the contractor payment experience?

Automation significantly improves the contractor payment experience by enhancing accuracy, efficiency, and transparency throughout the payment process. It helps to better add payees and manage payees through any type of payee program. Contractors, who often rely on timely and consistent payments, benefit from the reduced friction and enhanced reliability of automation. Here’s how automation transforms contractor payments: Quicker Payment Processing Automating contractor payments optimizes the entire payment workflow, reducing the time it takes to process payments from approval to disbursement. Automated payment systems initiate transactions when the international contractor submits an invoice or completes a milestone. This ensures you pay freelancers faster than manual methods. Error Reduction and Accuracy Payment processing and manual data entry are prone to human errors, including incorrect amounts, duplicate payments, lack of validation, or missing transactions. Automation will minimize these issues by automatically pulling data from approved invoices, communication channels, or work logs. This means contractors are paid accurately and on time. Improved Transparency AP automation provides contractors with greater visibility into the payment process. Self-service supplier portals and automated notifications keep contractors more informed about the status of their transactions, from submission to approval and then disbursement. Flexible Payment Options Automated platforms allow contractors and providers to select a preferred payment method, such as: Direct deposit Wire transfer PayPal Digital wallets This flexibility enhances the contractor experience by accommodating their needs and preferences. Additional Improvements Automated and efficient onboarding for contractors Tax management and compliance Enhanced collaboration and communication Automatic discrepancy identification and dispute resolution Lower administrative overhead

How do you onboard an independent contractor?

Onboarding an independent contractor involves several critical steps to ensure compliance, efficiency, and smooth collaboration between the contractor and the company. Unlike regular staff, contractors typically work on a project-by-project basis and must be onboarded in a way that reflects their independent status. Here’s a step-by-step guide to onboarding an independent contractor effectively: #1) Draft and Sign a Contractor Agreement The first step to onboarding with an independent contractor is to create a formal contract outlining the terms and conditions of the working relationship. This sets clear expectations and ensures that both parties understand their roles and responsibilities. The agreement should include: Scope of work Payment terms Duration Non-Discolure Agreement IP rights Termination conditions #2) Verify Contractor Status and Compliance Since contractors are not employees, companies must ensure compliance with labour laws and tax regulations. This step is crucial to avoid misclassification issues and potential legal or financial penalties. #3) Collect Personal and Payment Data Gather the contractor’s personal and financial data early on to facilitate seamless payments. This data collection means they can be paid quickly and according to their preferred payment method and company policies. #4) Establish Communication Channels Effective communication is essential to successful contractor relationships. Ensure the contractor knows how to stay in contact and communicate with your team throughout the project. Assign a Point of Contact: Provide the contractor with a single point of contact (e.g., a project manager) for questions or concerns. Communication Tools: Set up the contractor on any communication tools the team uses, such as Slack, Zoom, or email. Project Management Tools: If applicable, give the contractor access to any project management platforms (e.g., Asana, Trello, or Jira) to track tasks and deadlines. #5) Provide Necessary Resources and Access Independent contractors may need access to specific systems, files, or tools to complete their work. Set up their access quickly to avoid delays and ensure they can begin working as soon as possible. IT Setup: Create accounts for any necessary software, cloud storage (e.g., Google Drive, Dropbox), or company systems. Permissions and Security: Ensure the contractor has the appropriate permissions to access relevant systems while maintaining data security and privacy (e.g., VPN access, secure passwords, two-factor authentication). Onboarding Training: If the contractor needs to use any proprietary software or follow certain procedures, provide them with the necessary training or documentation to get up to speed quickly. #6) Define Key Performance Metrics and Milestones To ensure the contractor’s work is aligned with the company’s expectations, clearly outline the key performance indicators (KPIs) and project milestones that will guide the contractor’s work. Project Deadlines: Communicate the due dates for specific tasks or deliverables. Performance Metrics: Define the quality and performance standards that the contractor’s work must meet. Review Schedule: Establish a process for regular check-ins and performance reviews to ensure the contractor is on track. #7) Outline Invoicing and Payment Processes Ensure the contractor understands how to submit invoices and the company’s payment procedures to avoid delays in their compensation. Invoice Submission: Instruct the contractor on how and when to submit invoices. Some companies use invoice portals or require specific formats. Payment Frequency: Specify how often payments will be processed (e.g., bi-weekly, monthly, or after project milestones). Invoice Approval Process: Clarify any internal approval processes required before payments are made (e.g., manager approval). #8) Set Expectations for Reporting and Communication Contractors typically operate with a degree of independence, but it’s important to establish reporting and communication guidelines to keep everyone aligned. Work Updates: Define how often the contractor should update the team on their progress (e.g., daily, weekly, or at specific milestones). Reporting Structure: If the contractor is part of a larger team, make sure they understand the reporting hierarchy and who to go to with issues or questions. Feedback Process: Establish how the contractor will receive feedback on their work, whether it’s during regular meetings or through formal performance reviews. #9) Review Legal and Compliance Obligations Before the contractor begins work, review any legal and compliance obligations that apply to their engagement. This includes ensuring the contractor complies with industry regulations, privacy laws, or any certifications required to complete the work. Regulatory Compliance: Depending on the industry, verify the contractor's compliance with specific regulations or standards (e.g., data protection laws, certifications, licenses). Non-Disclosure and Confidentiality: Ensure that any non-disclosure or confidentiality agreements are signed and understood by the contractor. #10) Build a Relationship and Provide Support The onboarding process is an opportunity to build a strong working relationship with the contractor. Foster open communication, offer support, and make sure they feel integrated into the company’s project teams. Feedback Opportunities: Create a culture where contractors feel comfortable providing feedback about the onboarding process or their experience working with the company. Integration with Teams: If the contractor will work closely with other employees, make an effort to introduce them to key team members and integrate them into collaborative workstreams.

How do you effectively manage global contractor payments?

In today's globalized economy, managing contractor payments across different countries, currencies, and compliance requirements is more complex than ever. Businesses that rely on global contractors—whether freelancers, influencers, or consultants—must ensure their payment processes are efficient, accurate, and compliant with various regulations. One way to achieve this is through a software automation platform like Tipalti, especially when integrated with an ERP system. Such integration not only streamlines the entire contractor payment process but also enhances the overall experience for both businesses and payees, from onboarding through to payment.

What is payee management?

Payee management refers to the systematic process of handling and overseeing the individuals, businesses, or entities to whom a company or organization makes payments (also known as payees). These payees may include vendors, suppliers, contractors, employees, freelancers, or any other party that is due payment for goods, services, or other transactions. Effective payee management ensures that payments are made accurately, and on time; plus you know they’re in compliance with financial and regulatory standards. Key components of payee financial management include: Payee Account Data Collection and Maintenance Collecting and storing essential payee data, like their payee details, phone number, payee name, debit card (or other card payment), purchase order number, bank account (account number), payment preferences, contractual details, and other payee information. Ensuring that the payee data is regularly updated to reflect changes in address, banking details, or other critical information to avoid payment delays or errors. Payee Onboarding The process of registering a new payee into the system includes collecting necessary documentation for tax purposes, and verifying their identity and banking information. Compliance checks, such as verifying the payee’s status against watchlists, to ensure they can legally receive payments. Payment Method Selection Choosing the right payment method for each payee includes direct deposit, wire transfer, debit or credit cards, cheques, PayPal, or other digital payment platforms. Offering flexibility in payment methods to accommodate payee preferences while maintaining efficient processing. Compliance and Reporting All payments must comply with tax regulations, including withholding taxes when required, and appropriate forms must be issued. Maintaining a robust audit trail for all payments, ensuring transparency and accountability. Payment Processing Executing payments quickly, ensuring that each payee receives the correct amount without delays or errors. Monitoring payment status to ensure successful transfers and resolving payment issues, such as rejected or returned payments. Vendor and Supplier Relationship Management Managing relationships with vendors and suppliers by processing payments according to agreed-upon terms and schedules. Building trust and maintaining a good relationship with your list of payees through accurate and timely payments. Risk Management Identifying and mitigating risks associated with fraudulent payees or payment processing errors. Implementing controls ensures that only authorized and legitimate payees are added to the system and that the system will accept all payments that are properly approved.

How does automation improve the contractor payment experience?

Automation significantly improves the contractor payment experience by enhancing accuracy, efficiency, and transparency throughout the payment process. It helps to better add payees and manage payees through any type of payee program. Contractors, who often rely on timely and consistent payments, benefit from the reduced friction and enhanced reliability of automation. Here’s how automation transforms contractor payments: Quicker Payment Processing Automating contractor payments optimizes the entire payment workflow, reducing the time it takes to process payments from approval to disbursement. Automated payment systems initiate transactions when the international contractor submits an invoice or completes a milestone. This ensures you pay freelancers faster than manual methods. Error Reduction and Accuracy Payment processing and manual data entry are prone to human errors, including incorrect amounts, duplicate payments, lack of validation, or missing transactions. Automation will minimize these issues by automatically pulling data from approved invoices, communication channels, or work logs. This means contractors are paid accurately and on time. Improved Transparency AP automation provides contractors with greater visibility into the payment process. Self-service supplier portals and automated notifications keep contractors more informed about the status of their transactions, from submission to approval and then disbursement. Flexible Payment Options Automated platforms allow contractors and providers to select a preferred payment method, such as: Direct deposit Wire transfer PayPal Digital wallets This flexibility enhances the contractor experience by accommodating their needs and preferences. Additional Improvements Automated and efficient onboarding for contractors Tax management and compliance Enhanced collaboration and communication Automatic discrepancy identification and dispute resolution Lower administrative overhead

How do you onboard an independent contractor?

Onboarding an independent contractor involves several critical steps to ensure compliance, efficiency, and smooth collaboration between the contractor and the company. Unlike regular staff, contractors typically work on a project-by-project basis and must be onboarded in a way that reflects their independent status. Here’s a step-by-step guide to onboarding an independent contractor effectively: #1) Draft and Sign a Contractor Agreement The first step to onboarding with an independent contractor is to create a formal contract outlining the terms and conditions of the working relationship. This sets clear expectations and ensures that both parties understand their roles and responsibilities. The agreement should include: Scope of work Payment terms Duration Non-Discolure Agreement IP rights Termination conditions #2) Verify Contractor Status and Compliance Since contractors are not employees, companies must ensure compliance with labour laws and tax regulations. This step is crucial to avoid misclassification issues and potential legal or financial penalties. #3) Collect Personal and Payment Data Gather the contractor’s personal and financial data early on to facilitate seamless payments. This data collection means they can be paid quickly and according to their preferred payment method and company policies. #4) Establish Communication Channels Effective communication is essential to successful contractor relationships. Ensure the contractor knows how to stay in contact and communicate with your team throughout the project. Assign a Point of Contact: Provide the contractor with a single point of contact (e.g., a project manager) for questions or concerns. Communication Tools: Set up the contractor on any communication tools the team uses, such as Slack, Zoom, or email. Project Management Tools: If applicable, give the contractor access to any project management platforms (e.g., Asana, Trello, or Jira) to track tasks and deadlines. #5) Provide Necessary Resources and Access Independent contractors may need access to specific systems, files, or tools to complete their work. Set up their access quickly to avoid delays and ensure they can begin working as soon as possible. IT Setup: Create accounts for any necessary software, cloud storage (e.g., Google Drive, Dropbox), or company systems. Permissions and Security: Ensure the contractor has the appropriate permissions to access relevant systems while maintaining data security and privacy (e.g., VPN access, secure passwords, two-factor authentication). Onboarding Training: If the contractor needs to use any proprietary software or follow certain procedures, provide them with the necessary training or documentation to get up to speed quickly. #6) Define Key Performance Metrics and Milestones To ensure the contractor’s work is aligned with the company’s expectations, clearly outline the key performance indicators (KPIs) and project milestones that will guide the contractor’s work. Project Deadlines: Communicate the due dates for specific tasks or deliverables. Performance Metrics: Define the quality and performance standards that the contractor’s work must meet. Review Schedule: Establish a process for regular check-ins and performance reviews to ensure the contractor is on track. #7) Outline Invoicing and Payment Processes Ensure the contractor understands how to submit invoices and the company’s payment procedures to avoid delays in their compensation. Invoice Submission: Instruct the contractor on how and when to submit invoices. Some companies use invoice portals or require specific formats. Payment Frequency: Specify how often payments will be processed (e.g., bi-weekly, monthly, or after project milestones). Invoice Approval Process: Clarify any internal approval processes required before payments are made (e.g., manager approval). #8) Set Expectations for Reporting and Communication Contractors typically operate with a degree of independence, but it’s important to establish reporting and communication guidelines to keep everyone aligned. Work Updates: Define how often the contractor should update the team on their progress (e.g., daily, weekly, or at specific milestones). Reporting Structure: If the contractor is part of a larger team, make sure they understand the reporting hierarchy and who to go to with issues or questions. Feedback Process: Establish how the contractor will receive feedback on their work, whether it’s during regular meetings or through formal performance reviews. #9) Review Legal and Compliance Obligations Before the contractor begins work, review any legal and compliance obligations that apply to their engagement. This includes ensuring the contractor complies with industry regulations, privacy laws, or any certifications required to complete the work. Regulatory Compliance: Depending on the industry, verify the contractor's compliance with specific regulations or standards (e.g., data protection laws, certifications, licenses). Non-Disclosure and Confidentiality: Ensure that any non-disclosure or confidentiality agreements are signed and understood by the contractor. #10) Build a Relationship and Provide Support The onboarding process is an opportunity to build a strong working relationship with the contractor. Foster open communication, offer support, and make sure they feel integrated into the company’s project teams. Feedback Opportunities: Create a culture where contractors feel comfortable providing feedback about the onboarding process or their experience working with the company. Integration with Teams: If the contractor will work closely with other employees, make an effort to introduce them to key team members and integrate them into collaborative workstreams.

How do you effectively manage global contractor payments?

In today's globalized economy, managing contractor payments across different countries, currencies, and compliance requirements is more complex than ever. Businesses that rely on global contractors—whether freelancers, influencers, or consultants—must ensure their payment processes are efficient, accurate, and compliant with various regulations. One way to achieve this is through a software automation platform like Tipalti, especially when integrated with an ERP system. Such integration not only streamlines the entire contractor payment process but also enhances the overall experience for both businesses and payees, from onboarding through to payment.

Elevate Your Experience For

Contractors
Freelancers
Creators
Streamers
Affiliates
Publishers

Tipalti’s mass payment automation enhances your productivity while deepening payee relationships with a best-in-class payout experience.

View Pricing Plans

A person with glasses works on a laptop. Two charts overlay the image: one shows $27,456 labeled as "Domestic", the other depicts a graph with a highlighted point at $2,467 labeled "Overall".

Payee Management Features

A New Era of Payee Management

Enjoy a payee management solution where seamless onboarding, tailored communications, and secure processes come together. Enforce accuracy with automated invoicing and bolster security through advanced fraud detection in your payment processes.

Onboard payees anywhere

Collect and validate contact, tax, and payment details via a self-service onboarding experience with support for more than 27 languages. Guide payees through digital tax form submission and empower them with a choice of preferred payment methods and currencies.

Automate payee communications

Data is sent to Tipalti via API, CSV file, or direct integration into your tracking systems to trigger payments. Branded notifications are delivered proactively when payments are sent and when updated or additional information is required to process a payment. Payees can track payment statuses, view payment history, and update information anytime to help reduce inquiries.

Customize the payee experience

Your brand takes center stage with our range of customized integration options, including a branded portal, an embeddable iFrame, and fully flexible APIs. The result: a user experience tailored to your business needs.

Create invoices for payees

Automatically generate invoices on behalf of your payees and allow them to approve invoices before payment. Relieve payees from creating and sending invoices and free your team from tedious tasks like verifying invoice accuracy and chasing down missing invoices or invoice details.

Detect payee fraud

Monitor payee data points to proactively uncover patterns and identify potential fraudsters in your network. Risk cases are opened for your review if a payee is related to previously blocked or suspended payees from OFAC, AML, or internal screens.

Integrations

Pre-Built ERP Connections to Extend Automated Workflows

Easily extend and simplify your workflows with pre-built integrations and powerful APIs for your ERPs, accounting systems, performance marketing platforms, HRIS, SSO, Slack, credit cards, and more.

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How It Works

Up and Running in Weeks, Not Months

Collaborative customer support with customized onboarding to get you operational quickly

Step 1

Plan

Kickstart your success with a comprehensive initial call to align on goals, scoping, and technical configurations for your setup and to prepare you for training.

Step 2

Configure

Customer onboarding experts configure Tipalti sandbox and production environments, test the hosted payee portal or embedded iFrame, execute sample payment runs, and establish integrations.

Step 3

Deploy

In-depth training on the Tipalti Hub and end-to-end payment automation functionalities will ensure thorough knowledge transfer to turbocharge your successful launch.

Step 4

Adopt

Tipalti supports user adoption and change management during launch with the option to guide payees through onboarding too. Once set, you’ll be ready to fund your Tipalti Virtual Account, execute your first batch of payments, and officially launch Tipalti.

Step 5

Optimize

Following your setup, technical support teams are always available by phone and email, and the Tipalti customer success team will continuously advise you on achieving your goals.

Customer Stories

Don’t just take our word for it,

see what our customers are saying

Stay22

Since going live with Tipalti, Stay22 has more than doubled the number of global payouts it processes each month, with almost no errors.

Product

Mass Payments

Region

Canada

Industry

Affiliates and influencer networks

Size

Sub 100

Ring Partner

With Tipalti, RingPartner automated publisher payouts, improved cash flow with scheduled payments, and ditched multiple banking systems.

Product

Mass Payments

Region

Canada

Industry

Affiliates and influencer networks

Size

Sub 100

Flytographer

Flytographer cut 95% of its payments workload and added flexible, easy payment options to strengthen partner relationships.

Product

Region

Industry

Size

The Language Group

The Language Group cut hours of data entry to keystrokes, reduced payment runs from 4× to 1× monthly, and avoided hiring as contractors grew.

Product

Region

Industry

Size

Ninja Tune

Since adopting Tipalti, Ninja Tune has reduced its payment processing time by 50% and typically pays artists about a week earlier than before.

Product

Mass Payments

Region

United Kingdom, Global

Industry

Music royalties

Size

Sub 100

Tapjoy

Tapjoy cut payment workload by over 50% and boosted developer satisfaction with timely, flexible payment options.

Product

Mass Payments

Region

United States, Global

Industry

AdTech

Size

100 – 1000

CrazyGames

Tipalti’s mass payments solution transformed CrazyGames’ payouts process from a manual operation into a seamless, efficient system.

Product

Region

Industry

Size

Thematic

Thematic cut the need for 3 team members by automating global payments and streamlined artist onboarding and royalties with a self-service portal.

Product

Mass Payments

Region

United States, Global

Industry

Music royalties

Size

Sub 100

Freestar

Freestar saved a week monthly on payouts, improved controls, ensured tax compliance, and avoided hiring 2 extra team members.

Product

Region

Industry

Size

Transparent, Scalable Pricing

Our flexible pricing adapts to businesses of all sizes. Pay only for what you use—no extra costs, no client-based fees. Simple, predictable, and budget-friendly.

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Industries