Prepare Your Business for the Future of Payments

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Prepare Your Business for the Future of Payments
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Payments are a fundamental part of business – from the local mom-and-pop shop all the way up to global enterprises. So, technology changes occurring in the payments industry tend to have a big impact. And make no mistake, changes are coming. Check out the latest edition of PluggedIN: The Future of Payments for a look at some of the biggest trends in payments technology, including:

  • The Past, Present, and Future of Payments
  • Request to Pay: Payment Meets Communication
  • The Rise of Real-Time Payments
  • Integrating and Automating: From Procurement to Payment

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Author Name
Matt Tarpey
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How Request-to-Pay is Adapting Payments to the New Normal

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How Request-to-Pay is Adapting Payments to the New Normal
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It’s clear that the COVID-19 pandemic will likely have a lasting impact on many things, from the way we travel to the popularity of remote work arrangements and contactless delivery options. Add to that list the way individuals and small businesses make and request payments. As this new white paper from Finextra and Exela discusses, the economic crisis brought about by the pandemic will create a situation where both payers and payees will benefit from Request-to-Pay (RtP), a more agile solution to settling invoices and debts.

Request-to-Pay removes some of the friction related to sending and receiving payments and increases liquidity - a crucial benefit for the post-coronavirus world.

Influx of Gig Workers

One of the biggest groups RtP stands to benefit is the newly-unemployed. The closures, temporary or permanent, of businesses across the world led to a massive wave of layoffs and furloughs. According to Fortune, 44.2 million people filed for unemployment services in the U.S. during the coronavirus pandemic, as of mid June. This spike will likely lead many who previously held full-time positions to turn to freelance or gig work as a source of income.

With a less stable income, many of these workers are likely to opt out of direct debit bill payments, as they may not be able to guarantee that their accounts will contain the necessary funds when the bills come due. But with RtP, they get a direct line of communication with the payment requestor, as well as the ability to renegotiate and submit partial payment, allowing them to retain more control over their obligations and payments.

Lenders Pulled in Two Directions

As more people are faced with the looming or present threat of financial instability, many will turn to banks for support. This will naturally cause lenders to want to tighten their lending criteria in order to protect their assets and invest wisely. However, at the same time, due to the nature of the crisis leading to the rise in financial instability, banks and other financial institutions may face political pressure to take on more risk to help support families and small businesses.

In some cases, utility companies facing similar pressures have sought flexible tools that would allow people to slip into shortfall without taking a sizable credit hit. Financial institutions may want to adopt similar practices in order to assist their customers through these unprecedented times.

Request-to-Pay can mitigate some of the risks associated with lending by combining an instant payment function with an easy communications channel where parties can enter into a dialogue.

to discuss and potentially update terms of payment. This not only reduces some of the costs associated with chasing down payments, but also limits the need to involve third parties like debt collection agencies.

In many cases, it’s in the lender’s benefit to allow some flexibility in payment terms. Many customers may only need a few extra days. RtP makes it easy to formally agree to this type of modification, allowing lenders to avoid a lengthy and expensive arrears process and instead receive payment, albeit a little later.

This type of flexibility is made possible by the speed at which RtP delivers funds - that is, instantly. The ability to send and receive payments instantly creates greater liquidity, making it less risky to negotiate bills and invoices.

Conclusion

As COVID-19’s impact continues to reshape our economy, cash flow will be top of mind for small businesses. At the same time, faced with unexpected job losses, millions of consumers may enter the gig economy, forcing them to adapt to a life with less consistent income and less financial security. Financial institutions and lenders will face pressure from governments to resist the natural inclination to tighten lending criteria in order to provide support to families and small businesses as they deal with the financial fallout of COVID-19. Innovations like RtP can help dampen that blow and smooth out the transition.

New products that harness real-time payments and Open Banking are uniquely suited to thrive in this new normal. Such innovation is often stifled by apathy or inertia, but the current crisis has invigorated businesses to actively seek out paradigm-shifting solutions like RtP. As the world emerges from the COVID-19 pandemic to discover a new normal, easier, more flexible payment options may be one way it changes for the better.

For a deeper dive into how Request-to-Pay is tailor-made to solve some of today’s biggest financial challenges, download the full whitepaper here.

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Matt Tarpey
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Industry Solutions

Finance and Accounting Solutions

Finance & Accounting

Take your finance department to the next level with powerful order-to-cash, procure-to-pay, and record-to-report solutions, conveniently housed within a single, intuitive platform.

Industry Credentials
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Finance & Accounting Solutions Suite (FASS)

Exela offers proprietary software, web platforms, applications, and machine learning systems that work individually or in combination to offer superior money management solutions, streamlined and automated workflows, improved risk mitigation strategies, optimized cash flows, and enhanced data collection, analysis, and reporting.

Firm Lowers Costs by Outsourcing Remittance Operations

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Banking & Financial
Features & Benefits
CHALLENGE:

A Fortune 500 provider of global procurement, payment and travel services, with 181 billion dollars in assets sought to reduce its total cost of ownership (TCO), associated with its front-end and back-end remittance processing, to just 80%. Managing an annual volume of more than 30 MM paper remittances in-house required significant investments in equipment, labor, system licenses, and PCI-compliance audits. To off-set some of these costs, the firm wanted to downsize and consolidate its in-house operations. The firm was also getting bogged down with multiple software licenses, in-house ACH clearing systems, and contracts that were due to expire.

SOLUTION:

The firm selected Exela as its primary out-source provider for its remittance processing operations. Currently, Exela processes an annual volume of more than 30MM payments for the firm. Outsourcing its remittance operations, including its manual keying and depository functions, provided the firm with a means of reducing its total ownership costs. The implementation encompassed a phased approach, beginning with front-end operations, and continuing with IT/back-end processes, including ACH clearing, quality assurance and depository functions. Working together with Exela, the firm completed a successful migration from its previous remittance platform, US Data Works, to Exela’s TMS system. The firm’s ACH engine, which was also expiring, was replaced with Exela’s solution.

Today, we provide the full spectrum of paper and electronic payment processing services including:

  • Commercial and retail LockBox processing services
  • Electronic LockBox services
  • Remote remittance LockBox spoke
BENEFITS:
  • Improved processing turn-around times, from 3 ½ days to 48 hours
  • Decreased the firm’s total ownership costs by 20%
  • Dedicated Relationship Management
  • Continuous SLA Achievement: Payment post accuracy (99%); timeliness; duplicate payments; exceptions; decisions processing errors; misposts
  • Continuous Improvement: Since partnering with Exela, this firm has benefited from several system upgrades; process improvements and service extensions.
  • Risk Mitigation: By entrusting it’s auditing and compliance activities to an expert. the firm was able to reduce its risk of regulatory non-compliance
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Alabama’s Department of Revenue Makes Taxpayers Happy with New, Automated Process

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Public Sector
Features & Benefits
CHALLENGE:

When it comes to processing tax returns, people expect the government to respond in a timely and efficient manner. Many local and state governmental organizations still rely on outdated, physical paper-based workflows when processing consumer tax returns—opening the door for processing delays and errors, not to mention risk from a lack of standardization across departmental systems. Without automation, agencies struggle to: keep up with evolving compliance and security regulations; handle seasonal peaks in volume; absorb added labor costs; and implement uniform quality control procedures. New mandates from U.S. law-makers for wide spread, systemic changes are propelling agencies towards a complete over-haul of existing forms processing operations.

Alabama’s Department of Revenue (the Agency) was just one of hundreds of governmental organizations looking for outside help to modernize its forms processing environment. It was struggling to absorb costs associated with hiring and supervising seasonal workers to handle peak season tax return volumes, as well as labor required for data-entry and mailroom functions. To add to this, a new change to the hiring process was implemented, which required background checks for all temporary workers. The agency was experiencing a huge bottle neck and long processing delays during tax return preparation, caused by older remittance processing hardware and software; and large paper backlogs. Tax payers were beginning to send in duplicate checks with their returns, which was a big source of the problem. Because its remittance process was entirely paper-based, it could take more than 14 days for customers to receive refund payments. Due to the sensitive nature of information, and the growing potential for tax fraud, it was also important to have stringent security and risk mitigation procedures in place. Finally, the agency needed to update its current system to enable electronic and web-based reporting; for greater transaction transparency and workflow governance.

SOLUTION:

With taxpayers dissatisfied with long processing delays; the limited storage capacity and inconvenient location of its stand-alone warehouse; and mounting hiring and facility maintenance costs, the Agency decided that it was time to make a change. After weighing the options, the Agency determined that outsourcing to a seasoned provider was the best and only option. It selected Exela as its outsourcing partner because of its decades-long history of providing remittance services to large governmental organizations.

Leveraging Exela’s expertise and proprietary digital technology, the Agency could now streamline and modernize all aspects of its remittance operations. Replacing manual workflows would significantly improve the customer experience by reducing payment cycle times and minimizing security risk. To help further reduce over-head costs, and create more jobs for Alabama residents, Exela worked with the State to construct a brand new facility that would replace the Agency’s on-site warehouse. All of the Agency’s remittance operations would be transferred to this facility.

The partnership with Exela began in the year 2000 with the implementation of keying services, with additional services added incrementally over time to ensure a seamless transition. Today, Exela manages the entire spectrum of the Agency’s remittance operations including:

  • Opening envelopes and removing contents
  • Preparing and scanning returns
  • Data keying
  • Image capture and storage
  • Quality review and assurance
  • Document destruction

Exela processes approximately 3,100,000 pieces of mail and 1,000,000 checks during the course of the year. During peak seasons, volumes can reach up to 15,000 transactions within a single day, translating into a capture of more than 1,000,000 keystrokes annually. Documents are converted to digital images utilizing Exela’s proprietary, high speed IBML technology for high quality image output, and to ensure that scanned images are exact (or better) duplicates of original documents.

To date, Exela supports the Agency’s evolving remittance needs by providing:

  • End-to-end tax return processing for: individual income tax; corporate tax; withholding tax; sales and use tax; crash records/accident reports; and other misc. taxes
  • Voucher and tax return payment processing
  • Modernized image hosting and archival platform
  • Web-based remittance and volume reporting
  • Data processing support for refunds, filing extensions, and other exception items and correspondence
  • LockBox services/remittance processing including Check 21 (managing 1.1 million dollars in transactions per year)
  • Middleware Software Security and Testing (MIST); development of techniques and procedures for vulnerability assessment
  • Online customer exceptions management
  • Fraud detection and prevention system
  • Mail room services including, a certified mail receipt tracking system for packages receipt notification
  • 2-D barcoding system
BENEFITS:

Since the full implementation of services, Alabama’s Department of Revenue has benefited from a complete transformation of all aspects of its forms and remittance processing operations. By automating and streamlining its workflows, the Agency has realized significant cost-savings, greater accuracy rates and quicker processing turn-around times. While, implementing stricter security measures and controls enabled the Agency to reduce the number of fraud incidences; resulting in additional savings. With the implementation of Exela’s solution, deposits can be made multiple times a day versus daily or bi-weekly. As a result, insufficient funds can be recognized sooner. This enables the Agency to quickly proceed with communication and collection activities.

Specific accomplishments include:

  • Reduced average tax return turnaround from 14+ days to 24 to 48 hours
  • Implemented 2D barcoding capabilities to capture data with 100% accuracy and same day turn around
  • Executed archival scanning processes for closed withholding and envelopes, among others
  • Reduced state-employed data entry and mailroom staff by 250 full time employees
  • Experienced $2 to $4M annual savings through W-2 fraud detection and prevention
  • Eliminated a 30,000 square foot warehouse
  • Significantly improved revenue collection and float reduction by re-allocating resources towards hiring more collectors and depositing return payments at a faster rate
  • Modernized its reporting system to include, web-based reports, electronic remittance reports, and electronic daily volume reports; creating greater transparency and accountability
  • Eliminated Unisys Check Transports and Software, which saved the state hundreds of thousands of dollars in annual software and maintenance fees
  • Reallocated 165 full time employees to concentrate on critical tax collection activities
  • Redistributed 12,000 square feet of space to employee classrooms and training rooms
  • Achieved processing accuracy rates of no less than 99.5%
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Industry Solutions

Banking Giant Saves Millions by Outsourcing LockBox Operations to Exela

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Finance & Accounting
Features & Benefits

Faced with increasing economic pressures, an expanding geographic footprint and more demanding customers, financial institutions are choosing to outsource peripheral lockbox processing functions and re-focus efforts on upgrading and expanding core offerings. Aside from the obvious cost-savings implications, relying on the expertise of a dedicated LockBox provider can offer businesses several strategic advantages. Amid a rigid regulatory landscape and growing privacy concerns, the need for effective security controls and enhanced compliance measures is more important than ever. And, many organizations don’t want to be burdened with added investments in state-of-the art equipment and emerging technologies. By outsourcing their LockBox operations, financial institutions are finding new ways of diverting and re-allocating resources and expenditures for improved productivity and competitive gain.

CHALLENGE:

As one of the top 8 financial institutions in the U.S., this firm was searching for opportunities to maintain its competitive edge in a continuously evolving and demanding marketplace. Delivering superior products and customer experiences was at the forefront of its priorities. But, extensive resources were being pulled away from its core banking operations to manage its LockBox processing activities, spread across six different cities. The bank was also struggling to keep on top of emerging technologies and the latest industry best practices, while, at the same time, trying to improve customer retention and acquisition rates through exceptional customer service. Although the bank has been outsourcing other onsite operations to Exela for the past 30 years, it wanted to take the next step towards total re-allocation of resources. Customer data security and privacy were additional considerations for the bank.

SOLUTION:

To advance its strategic agenda, and leverage the expertise and technology of others in this space, the bank made the decision to outsource its LockBox operations. It sought the assistance of a specialized technology provider that was well-versed in executing large, onsite remittance implementations. It selected Exela because of its vast network of talent; versatile service-delivery model; technologically-advanced applications; and experience managing operations across multiple sites. The solution, valued at 100 million dollars, has expanded in scope to include the following:

  • LockBox Processing: Exela is charged with overseeing and executing all aspects of the firm’s LockBox operations across six locations; utilizing existing facilities and equipment. As part of the end-to-end solution, Exela manages mail retrieval; image and data capture; archival; delivery; remittance; and the secure transfer of customers’ information.

  • Worked with HR to establish a transition team

  • Employee Conversion: To complete the total transfer of LockBox operations, Exela added over 600 on-site bank employees to its workforce. This is in addition to the more than 1,500 employees that have been re-badged during this partnership. To ensure a successful conversion, the following procedures were completed prior to implementation:

    • Collaborated with bank staff to determine important goals for the transition process

    • Established a transition team by working with Exela’s Human Resources and Recruiting departments

    • Implemented peer to peer support and knowledge transfer programs for transitioned employees

    • Scheduled regular cadence and toll-gate employee reviews

  • Robust Disaster Recovery/Business Continuity Plan

    • Recovery procedures and recovery time objectives for each application or critical infrastructure

    • Roles and responsibilities of technology recovery teams

    • Communication plan

    • Procedures on how to invoke the technology recovery plan(s)

    • Dependencies on other plans (including technology)

    • Prioritization strategy

    • Back-up procedures including frequency and retention

  • Enhanced Governance Model

    • Weekly meetings, status calls, gate reviews

    • Dedicated project manager

    • Constant communication among key client and Exela stakeholders

    • SharePoint team site

    • Established product requirements / assumptions / constraints

    • Developed team action report

    • Implemented project cost controls

    • Utilized status dashboard

    • Instituted steering committee consisting of high-level Exela management

    • Initiated change control process; internal audits and sponsor feedback procedures

BENEFITS:

A partnership with Exela has produced several positive results. Most notably, is a cost savings of $40 Million over the last 10 years. The bank has also achieved 99% of its performance goals. Leveraging the resources and expertise of an established LockBox provider has allowed the bank to dedicate its operations to the development and delivery of core banking products, while delighting customers with exceptional service. Some additional benefits include:

  • Minimal investment in equipment ownership and maintenance

  • Continuity of labor and employee wages

  • Mitigation of privacy and information security risk

  • Opportunity for future process improvement and cost-savings

  • Courier service/mail delivery reliability

  • High level of processing accuracy

  • Consistency of workflows across bank sites

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Not-For-Profit Organization Overhauls Remittance Processing for Faster and More Cost Effective Results

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Public Sector
Features & Benefits
CHALLENGE:

A large not-for-profit animal welfare organization based in Boston was in desperate need of a more updated, efficient and cost-effective remittance processing solution. Handling thousands of payments in the form of checks, cash, and credit cards was a daunting task. It relied largely on manual intervention and legacy equipment. The company realized that their traditional, remittance processing system was no longer sustainable. Workers were required to sift through donations, scan checks, and manually process cash and credit card payments. This was both costly and cumbersome, consuming valuable resources that could be more efficiently utilized in other areas. Any exceptions had to be manually handled, usually involving additional reviews and re-scans. Moreover, the entire process, from receipt to deposit, was taking up to 4-5 days. The organization could also benefit from more reliable marketing data for effective and targeted campaigns aimed at soliciting sponsorships. There was no efficient way of collecting and integrating customer profiles into their existing CRM system.

SOLUTION:

As the number one remittance provider, Exela was uniquely positioned to take over and improve the organization’s operations. Utilizing high-speed intelligent scanning and data capture technology, a large portion of the workflow was automated. By digitizing data capture and payment processing activities, and creating a more streamlined approach, less workers were required; human error minimized, and deposits expedited. As an additional advantage, the platform supported multiple forms of payments, including check, cash, and credit card.

Exela managed all aspects of the organization’s sponsorship payment operations. The solution began with mail pick up at the local post office; followed by opening, preparing sorting and batching. Next came image and data capture, utilizing advanced intelligent scanning equipment and Optical Character Recognition (OCR) technology. Images were then delivered to the client via an FTP server. Payments are automatically batched; data corrected and completed, and business rules implemented. Exceptions review and reconciliation takes place via a secure, online portal. Deposits are then prepared, along with with ICL and Accounts Receivable (AR) files, and dispatched to the bank. Exela also provided a donation repository archive, so the organization could view images and host their Gift Aid images for HMRC returns.

To assist the organization with its marketing campaign efforts, Exela was able to extract pertinent data from sponsor correspondence to import into its marketing tool. The organization uses this to upload sponsor data into its customer relationship management (CRM) system. Any opt out customers are identified and flagged, enabling the organization to update customer profiles accordingly.

RESULTS:
  • Client is able to obtain and utilize sponsorship data captured from correspondence to inform and enhance future marketing campaigns
  • Significant cost savings by automating traditionally manual processes and replacing outdated legacy systems
  • Greater adherence to regulatory and data security requirements; comprehensive security control framework and oversight
  • Decreased payment processing time from 4-5 days to 48 hours
  • Reduction and or/re-allocation of labor resources
  • Automated exceptions for faster reconciliation and approval
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Industry Solutions

Tatiana Koleva: Delivering End-User Satisfaction for Legal and Financial Customers

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Legal
Blog Content

When it comes to delivering desired outcomes to end-users in the context of digital transformation, the first rule of thumb is understanding who your end-users are. Of course, that’s no simple task, as we explain here. Luckily, one of Exela’s strengths is that we recruit and cultivate leaders who possess exceptional analytical prowess. One such leader is Tatiana Koleva, Exela’s Senior Vice President of Service Delivery. Tatiana is responsible for the services Exela delivers on-site for customers in the financial services- and legal-industries. In other words, Tatiana is on-site with our financial services and legal industry customers, ensuring end-user satisfaction at every level, even as the end-user landscape is in a constant state of evolution.

“I interact with people all day long and it is what I love most,” Tatiana tells us. In addition, she feels “privileged” to be leading her teams of “dedicated, customer-focused professionals who strive to deliver excellence in service every day.”

How Tatiana came to be doing what she’s doing

Tatiana attributes her success and her current position to “good fortune,” but it’s clear she’s worked hard for everything she’s achieved. “Six months after arriving in the U.S. from my home country of Bulgaria, I got an entry level job with the outsourcing division of Pitney Bowes and started learning about business and leadership and taking every opportunity to learn and grow.”

Tatiana’s favorite Exela offering

I am really excited about Smart Office,” Tatiana tells us. “So many of our customers are focused on improving the experience of the millennials they're hiring, while also keeping real estate costs down. Our technology solves both. Our solutions provide visibility as to how services are used. As such, they can be provided where needed to enhance the user experience, while reducing the expense of providing them. It is a win-win.”

What Tatiana’s working on—right this very minute

“We are working on expanding services globally for many customers. It presents new challenges to solve for, which excites me, as well as the team.”

Tatiana on “innovation”

If you ask a handful of people how they define “innovation,” you’ll get a handful of different answers. What we’ve noticed is that the way one defines “innovation” has a lot to do with that person’s particular relationship to innovation. For example, this one comes from a tech-marketing perspective. For Tatiana, “innovation is a cultural trait, it is how we think about what we do, how we listen and respond to client needs, how we define the future of how our customers operate and how we deliver services. Sometimes it is progressive and sometimes it is disruptive. It’s change as a way of life.”

We asked Tatiana to give us her #FiveWordsAboutYou.

Here’s what she came up with:

  • #determined
  • #fearless
  • #extrovert
  • #disciplined
  • #open-minded

What you probably don’t know about Tatiana

  • Would you have guessed that Tatiana wrote poetry when she was younger?
  • She also loves dancing and grew up dancing with her family.
  • While growing up in a communist country, she really had little exposure to “business” as we know it in a capitalist society. So, her idea of success back then was to be a diplomat, and that was her dream job as a child.
  • Favorite author since childhood: Oscar Wilde
  • Favorite film: The Intouchables (a French buddy comedy-drama film from 2011 that her daughter, who was studying French, wanted her to watch). “It left quite an impression on me.”

Here’s more about the industry-specific solutions we’re delivering to our financial services industry customers, and to our legal industry customers.

Note:

Not all of Exela’s business process optimization solutions are industry-specific, however, and many of our clients, including our financial services and legal industry customers are also benefitting from our broad variety of solutions designed to optimize the business processes of enterprises in virtually any industry.

These include the entire array of Smart Office suite of solutions referenced by Tatiana above. You can learn all about how a major institution deployed one such solution, Intelligent Lockers, to great advantage.

Author Name
Lauren Cahn
Date
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Industry Solutions

Finance & Accounting Solutions Suite (FASS)

Exela offers proprietary software, web platforms, applications, and machine learning systems that work individually or in combination to offer superior money management solutions, streamlined and automated workflows, improved risk mitigation strategies, optimized cash flows, and enhanced data collection, analysis, and reporting.

Unified communications for better billing.
We’ve turned collections into a science.
The next level of AP automation.
Powerful tools for financial tracking, analysis, and visualization.
Explore Exela's Fixed Asset & IT Asset Management Software.
Automated omni-channel payments processing.
Simplifying invoice buying and selling.
Intelligent automated systems streamline procurement.
Lockbox solutions and automated payment processing technologies.
Bringing billers and payers together through secure messaging and flexible payment options.
Smart expense management from the office or the road.
Intelligent tools for managing cash flow & mitigating risk.
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