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Bob Kaufman explains how integrated payment frameworks transform reconciliation processes for travel and tourism businesses.
Within the dynamic realm of travel and tourism, payment intermediaries play a pivotal role in orchestrating seamless transactions between avid globetrotters and an array of third-party providers. Whether it’s the cherished local travel boutique or the sprawling global ticket comparison emporium, these entities embrace a common thread of acting as middlemen.
This distinctive landscape introduces an added layer of intricacy compared to enterprises solely focused on processing payments for tangible goods or services. For intermediary enterprises, funds flow in, but a portion of these monetary streams must swiftly cascade to a myriad of potential third-party beneficiaries.
Navigating this complex network often presents formidable challenges, culminating in fragmented procedures and substantial frustration. Manually cataloguing invoices, grappling with incomplete back-office data, and the conundrum of working with diverse payment systems collectively impede the precision of reconciliation efforts.
Against this backdrop, let us embark on an exploration of the profound significance that exists within integrated and all-encompassing payment frameworks. These frameworks stand as fortifications against the impediments outlined, wielding a transformative influence on enterprises.
The price of poor reconciliation
For enterprises bogged down in a whirlwind of transactions and B2B disbursements, the onus on financial teams is nothing short of monumental. Harmonising records, uncovering disparities, and resolving reconciliation problems evolves into a laborious, error-prone undertaking that can diminish potential revenues.
Remarkably, nearly one-fifth of organisations persist in relying solely on manual data reconciliation. The UK government provides guidance on how to tackle data quality, referencing how experts think that organisations spend between 10-30% of revenue on handling data quality issues.
However, the conundrum extends beyond the fiscal tapestry: a prior study has shown that a staggering 87% of accountancy professionals work overtime during the financial close process. Within this time, stress levels skyrocket for 60% of these professionals, with a quarter eventually leaving their company due to these heightened pressures.
Astonishingly, a considerable 73% of companies still grapple with manual, spreadsheet-based systems, while an even more telling 84% yearn for streamlined procedures, liberating their business for strategic pursuits and insightful analyses.
A separate survey has unveiled that a mere 20% of respondents were satisfied with their current workflows, with a paltry 28% trusting in the fidelity of their data. This can cause immediate fiscal setbacks, such as penalties stemming from non-compliance with reporting and tax statutes, or an inability to detect and prevent fraud.
The problems go even further: at a time when anyone can see their entire financial life on their phone it seems completely backward that major companies are going through manual invoice sorting and spreadsheet tabulation.
Embracing the efficiency of integrated payment systems
In the realm of travel and tourism, where intricate financial transactions abound, the value of integrated payment systems becomes evident. Many businesses are moving away from using basic Excel spreadsheets and adopting advanced enterprise resource planning (ERP) systems like Sage, SAP, and Oracle. These systems offer valuable financial insights, but their true potential is unlocked when paired with comprehensive payment systems. This is where smarter solutions come into play.
Imagine a solution that simplifies the process of reconciling payments, allowing finance managers, procurement leaders, and accounts teams to bid farewell to the laborious task of matching transactions from various suppliers, buyers, and systems.
This solution already exists. By centralising incoming and outgoing transactions within a single platform, the need for manual efforts is eliminated, saving time, money, and internal resources.
Automated reconciliation is at the heart of this solution, enabling instant matching of transactions. This integration between payment processes and financial systems reduces the chance of errors and discrepancies. The outcome is improved accuracy, greater efficiency, and enhanced cash flow.
The benefits of automated reconciliation
Useful insights: Ensuring finance teams have access to accurate data empowers them to extract meaningful insights. Reliable information allows CFOs, finance managers, and purchasing heads to make informed decisions and allocate resources effectively.
Time and cost savings: Automated reconciliation eliminates the need for labour-intensive manual data matching. Businesses no longer need to allocate valuable resources to find and fix errors. By reducing operational costs and improving efficiency, companies can focus on strategic growth initiatives.
Faster expansion: Streamlining the reconciliation process accelerates business expansion. By removing obstacles and simplifying payment operations, companies can scale their operations faster and with confidence. The reduction in reconciliation time allows businesses to focus on nurturing customer relationships and exploring new opportunities.
Reporting and analysis: Robust reporting and analysis features enhance the speed and accuracy of the reconciliation process. Finance teams gain comprehensive insights and actionable data, enabling them to identify trends, optimise processes, and make well-informed financial decisions.
It’s time for businesses to move away from disjointed payment processes and embrace the power of integrated payment systems to drive their financial operations forward.
With a comprehensive and user-friendly platform, companies can experience smooth reconciliation, actionable insights, significant time and cost savings, accelerated expansion, and informed decision making. By leveraging robust reporting and analytics, finance teams can guide their organisations towards sustained success.
Bob Kaufman is the founder and CEO of ConnexPay.