The changing face of business payments
Marc Pettican, President, Barclaycard Payments gives his views on how the pandemic has changed the way payments are made by businesses
Like everyone, I’ve seen how COVID-19 has led to increased flexible and remote working patterns, with more people than ever working from home. While we’re getting used to the normality of conference calls - with the dreaded phrase ‘you’re on mute!’ - as well as other various digital tools and platforms to remain productive outside of the office, the same can’t be said for many businesses’ approach to work expenses.
Accelerating the trend to digital
There has been a move away from traditional paper-based expenses systems over the past few years and the pandemic has accelerated this trend to more efficient and digital solutions. What we’re seeing is that the current situation has rendered expenses processed on paper unfeasible and, as a result, many businesses have been forced to rethink and streamline their approach to employee spending.
Until now, companies’ expenses processes have been viewed as manual and time-intensive. In some businesses, employees have been expected to fill out expenses by hand and submit them in person to the accounts team in the office. Often, this might mean them making payments from their own cards before being reimbursed. While many organisations offer company cards for their employees, the system still relies on a manual and time-consuming process for filing and paying back the expenses. All of this could create unnecessary friction between an employer and an employee, as people are expected be out-of-pocket for periods of time.
More companies are therefore moving towards digital management systems and there has been a surge in demand for online solutions such as virtual cards, and controls that help to manage day-to-day expenses in a more efficient way.
The uptake in these sorts of tools is important, not only because it saves time and ensures that employees are not out of pocket, but it also gives control back to the employer. Companies can implement systems that allow them to approve spending requests before purchases are made.
To help businesses small and large streamline the expense process for employees, Barclaycard Payments has created three top tips that companies should bear in mind:
1. Go digital
There has been an acceleration in digital as a result of COVID-19 and many people are keen to use touchless payment methods such as ApplePay or Google Pay, and merchants are increasingly taking payment through apps.
By adopting virtual cards, companies can ensure a new way of being agile and allowing employees to make purchases, whilst at the same time giving the company control over what payments are being made. If companies have a centrally-managed virtual card system set up, then employees don’t need to submit their expenses afterwards as they are already approved before the payment is made.
2. Use third parties
There are various solutions available, which are designed to work with both physical corporate cards and virtual cards. There is still a transition happening from physical to virtual payment solutions within businesses, with many companies still using elements of both.
Those that are still using physical corporate cards should look to a third party to ensure that the cards are integrated with digital expense management systems, even if virtual cards have not yet been implemented.
It’s also important that companies evaluate the services provided and implement systems which can be customised to reflect their existing expense policy and can be integrated with existing software. By laying the groundwork now, they will benefit later down the line.
3. Be flexible and adapt to new trends
There’s been a shift in how people work, with the working from home culture set to continue for the foreseeable future. Whilst business trips and associated travel expenses have decreased during Covid-19, expenses for items such as stationery, home-office equipment and virtual training have increased. Furthermore, with a full-time return to the office unlikely for many businesses – even in the longer-term – employees may increasingly move further away and then claim back any commuting expenses for they do incur.
This is a turbulent time for the ‘workplace’ as we know it and companies need to adapt to behavioural changes and reflect them in their payment systems.
As the world becomes more digital, so too must payment processes. I believe that embracing new technologies and digital systems provides businesses with the opportunity to operate fully, whether in the office or at home, and sets them in good stead, whatever the future holds.