PYMNTS Feature: Jay Dearborn Discusses COVID’s Impact on B2B Payments
How Will COVID Crisis Impact The Way Companies Make Payments?
In a recent interview for PYMNTS’ Masterclass series, Jay Dearborn, President, WEX Corporate Payments, discussed the impact of COVID-19 on B2B payments and how during COVID, fintech partners and financial institutions have been helping corporations make the transition to digital payments. He illustrated the ways companies have had to become more digitally agile today as a result of COVID, he discussed the need for companies to innovate with payments technologies to find new sources of value, and laid out those value propositions.
“I think when the pandemic hit in early March, it really put a gun to the head of many companies by taking what have been Byzantine processes around accounts payable or accounts receivable and moving to much more digital means,” said Dearborn.
As a result, companies were able to find new sources of value. One place from which new sources of value emerged was the cost savings realized when organizations digitized their accounts payable functional areas. By automating the accounts payable process, making it less laborious while ensuring reconciling and matching the payments going out the door, and gaining access to float, companies could turn digitization into a revenue opportunity.
Will COVID help to bridge AP and AR functions?
Speaking as a 20-year veteran of the payments industry, Dearborn provided his opinion on merging accounts payable and receivable functions and what potential wins may lie in a reorganization of resources. He pointed to how 72% of respondents in a recent study of fintech decision-makers affirmed that their processes had become more digital as a result of the pandemic. And 86% of those surveyed thought companies leading with technology transformation in their payments department would be best poised for a rebound coming out of the pandemic.
Continuing with that line of thinking, Dearborn went on to say, “The AP/AR divide: it’s been characterized this way for the past 20 years…We collectively all know what the end of the movie looks like. The end of the movie does look like a bridge that crosses AP to AR, with a payment, with terms, at the right price, with rich data. The question is, how do we get there? Our belief at WEX is that we’re marching in that direction as an industry and our job is, particularly on the AP side of the house and with payers, to enable them to digitize their payments, and get the data richly packed against those payments so that we can bridge that divide.”
Advice For Companies Hesitant to Adapt Technologically
In the Masterclass segment, Dearborn also offered advice to companies who are hesitant to change their payment technologies and processes. “I really don’t think in today’s day and age that you can ignore the AP or the AR digitization question,” Dearborn said of the trend toward digital payments.
Many companies who faced this pressure to digitize over the last eight months felt fortunate that there were technological fixes available to companies facing unique payments challenges because of the pandemic. Of the companies still standing in the wings, hesitant to adapt Dearborn reaches out to them with this: “We’re all blessed in this industry that there are tools available to treasury banks and to FinTechs alike that allow those with legacy processes to modernize fairly quickly.” And his advice to companies who have not yet made the transition is: “If you’re a corporate and you haven’t gone through an AP automation transformation yet, call up your local treasury bank and determine if there’s a digital offering that they can help steer you toward.” Dearborn adds that if you don’t get that from your local treasury bank, “find a fintech like WEX that can help you bridge that chasm.”
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Click here to watch the Jay Dearborn PYMNTS interview in its entirety.