Cross-Border Payments Practices Cost Heavily from Fees, Time, and Manual Labor

New Study Provides an Updated Look at Global Payments Practices for Growing Organizations

San Mateo, CA, Sept 18, 2018 – A new independent study carried out by research and analyst firm PayStream Advisors and commissioned by Tipalti, the leading global payables automation platform, found that the most common practices for managing cross-border payments are neither the most efficient nor the most affordable. Instead, they cost organizations heavily in payment fees, time, and manual labor, and can have negative impacts on supply chains and supplier relationships.

As globalization becomes an ever increasing reality in today’s world, organizations are expanding their supplier bases overseas, leading to an increase in cross-border payments. According to the study, 73% of US companies are now making some type of cross-border payments. However, international payment management entails taking on much more effort and risk than domestic payments in terms of compliance with international tax and regulatory requirements.

To do cross-border payments right, accounts payable (AP) teams must add in several extra steps and controls. One example is validating payment data accuracy to avoid payment errors. Over 26,000 global rules exist across different regions and payment methods. AP departments must often use multiple bank portals and payment rails to disburse funds across different countries and currencies, and cross-border payments reconciliation typically requires more advanced measures than domestic-only reconciliation.

Anna Barnett | Lead Research Analyst at PayStream Advisors, and lead analyst on this report

Some of the key findings from the report regarding complex cross-border payments include:

The fraud risks and complex international compliance mandates that come with the Foreign Account Tax Compliance Act (FATCA) and the Office of Foreign Assets Control (OFAC) for cross-border payments mean that companies can’t stick with the same time-consuming, error-prone accounts payable operation they often settle for with their domestic payments and still expect to remain competitive. Managing complex global payments successfully means implementing the right systems and processes that scale as a company grows and ensure fast, accurate mass payments to suppliers around the world – with minimal effort required by the AP team.

Chen Amit | CEO and Co-Founder, Tipalti

About the research
PayStream Advisors surveyed professionals across the United States in over 400 organizations from a variety of industries and market segments for this report.

About PayStream Advisors
PayStream Advisors is a research and advisory firm focused on business process automation in sourcing, supply chain management, procurement, accounts payable, payments, and expense management. PayStream’s team of experts provide targeted research and consulting services to address the changing needs of finance and procurement professionals. In short, PayStream is dedicated to maximizing returns and minimizing risks associated with technology investment. PayStream’s research reports, white papers, webinars, and tools are available free of charge at PayStream Advisors is a division of Levvel, an IT consulting firm specializing in technology strategy, design, architecture, and DevOps.