On October 20, SME Banking Club, together with CharlieIndia, organized a webinar on the topic of making request-to-pay happen with the help of e-invoicing.
At the beginning of the webinar, Katalin Kauzli (CharlieIndia) told that request-to-pay is a missing link that connects e-invoicing and payments, it’s important to understand the implications as it will be a game changer for the banks.
Implementation of e-invoicing and request-to-pay requires a change of way of thinking and a change of mindset. How invoices and payments are compatible? With the e-invoicing regulations coming into force, an invoice is becoming a structured data message and payment is a standardized structured data message between two counterparties.
After that, Katalin explained what request-to-pay is, and mentioned that it’s a messaging functionality, not a payment, just a payment initiation. Moreover, it supports an end-to-end process and lies between an underlying commercial transaction and the payment itself. Furthermore, request-to-pay is an enabler for digital payments. It also means that a payer and a payee electronically exchange structured data through a payment request before they exchange the money. This message exchange includes a payment request, and its acceptance or refusal.
Invoice data is an enriched data source and strategic asset for banking and is leading to a new generation of business banking:
1. Each invoice is a payment or financing (and cross-sell) opportunity.
2. Invoice data brings process optimization and additional insights for the bank.
3. Digitalize Processes:
- Initiate or request payment from invoice data,
- Real-time digital financing based on invoice data,
- Data modeling,
- Risk models using invoice data,
- Cash-flow projections for offering to finance.
What are the hurdles for the banks to implement request-to-pay?
1. This project is not a priority for the banks.
2. The lack of understanding of opportunities regarding invoice and invoice data.
3. The lack of integrated customer journeys, services, and business models.
4. The banks don’t have the necessary API infrastructure.
Request-to-pay might not be the number one priority, but it is for sure a low-hanging fruit for banks. Its strategic importance should be understood and it is a use case that is a win-win for both banks and banking customers because it is a service that delivers tangible value for banking customers and the bank can realize extra revenues.
In the last part of the webinar, Olena Gryniuk (SME Banking Club) and Katalin Kauzli (CharlieIndia) discussed the necessity of implementing request-to-pay by the banks, whether the digital maturity and implemented digital customer journeys are crucial for e-invoicing and R2P implementation, and also, they gave examples of the banks that started to implement request-to-pay for their customers.
To learn more details, watch the full webinar below:
