ACCELERATED by the COVID-19 pandemic, tech innovations used to streamline and add control to slow, manual processes are fast becoming a necessity, not an option.
Arguably one of the most crucial processes in any business is the onboarding of payees including suppliers and vendors, as this is when new relationships are initiated.
“Unfortunately, the rise in tech innovation brings with it a rise in cybercrime, and it is better to fight digital threats with digital tools,” notes Ryan Mer, CEO, eftsure Africa, a Know Your Payee™ (KYP) platform provider.
Here are some of the challenges faced during onboarding and how digital onboarding tools can help mitigate them:
New or changed payee account fraud
This particular brand of cybercrime costs the financial services industry billions of dollars each year. Interceptions or impersonations of new payee onboardings or requests by fraudsters to change bank account details and then using these bank accounts to perpetrate the fraud are a serious and daily occurrence.
“When onboarding new vendors or making changes to existing vendor details, verifying bank account data is a critical control that cannot be neglected,” says Mer.
Solution: Automate your KYP. Rather than implementing more procedures and often manual protocols, Mer says it is worth considering a third-party platform to help manage supplier data and automate supplier verification and payment checking, which will not only enhance security, but save your company time and increase accuracy by eliminating human inputting and verification methods.
Vendor Master Data
Maintaining supplier data integrity is critical, especially when it comes to bank account details. Information that was verified as correct at onboarding will not necessarily be correct further down the line if that information is updated or compromised. Fraudsters are constantly trying to manipulate staff (especially targeted at the finance and procurement teams) to update vendor bank account details or add fictitious supplier details.
Solution: Checking integrity of supplier details at point of payment. An automated solution that independently re-checks payment details prior to payment release can help identify compromised banking details and prevent a fraudulent payment from being released.
A solution such as eftsure’s payment screening technology can help identify compromised vendor banking details with the click of a button, prior to the funds being released. The screening will also identify if a supplier sitting in the payment batch has not come through proper vendor onboarding, approval and verification processes, thereby identifying a potentially fictitious supplier added to the payment batch.
Slow, inefficient processes
When demand for faster and easier processes has never been higher, relying on manual onboarding practices can cause your company to lag behind competitors as manual methods are generally slow, with lots of back and forward, negatively affecting the vendor’s onboarding journey.
Solution: Automated processes. As onboarding is one of the first experiences a supplier will have with your company, it should ideally be as seamless and simple as possible. By implementing a platform that can digitise and automate the process, you can speed up the onboarding journey considerably and collect all the information and compliance-related items a business may require upfront, saving time for all parties involved. A digitised and controlled internal approval process that is automatically part of internal procedures will also be a big win for internal staff who are responsible for this, as well as internal auditors who want to review the transaction trail.