Payment & Collection Newsletter

Finance & Treasury Have Expanded to a Strategic Role
Corporate finance and treasury officers' roles have expanded from operational to strategic, a move that has been accelerated by the recession. 81% of senior financial executives say that their job is more strategic than this time last year. 44% of senior financial executives now have daily contact with the CEO and board. Finance and treasury's responsibility have grown from managing balance sheets and cash flows to include: improving liquidity, increasing working capital efficiency, enhancing cash forecasting, taking advantage of global opportunities and managing fraud. Automating functions is a more pressing need for finance and treasury departments now that they are taking on more responsibilities. Many companies are still managing multiple vendors to accept customer's electronic payments, rather than saving time by allowing one vendor to manage all of their electronic payment channels.
Source: Wells Fargo Treasury Trends, April 6, 2010

WEB Payments Up, Unauthorized Transactions Down
Companies experienced cost savings in 2009 as people switched to lower cost ACH bill payments and companies spent less time managing unauthorized debits. WEB bill payments (ACH payments initiated at the billing company's website) grew 9.7% in 2009 vs. 2008 and unauthorized WEB debits decreased 13% down to 0.04%. One utility company in Florida continued their strong growth in 2009. However, this utility company has not always grown their electronic payments at impressive rates. Looking back to 2004, the utility's electronic payment adoption rate was well below industry average. The utility company substantially increased their electronic payment options and integrated the entire payment process resulting in a tripling of their electronic payment adoption rate.
Source: NACHA, April 7, 2010

Insurance Cos Look to Billing to Improve Customer Service & Retention
80% of Property & Casualty Insurers believe that billing is "very important" or "important" to customer satisfaction. "Billing has traditionally been looked at as an administrative task," Craig Weber from research firm Celent says. "But insurers are starting to take cues from large-volume billers, such as utilities and communications companies, and are realizing that billing is a very powerful tool for maintaining and enhancing customer service." As insurance companies look to improve their customer service with electronic billing, it's crucial to realize that not all customers are the same. Insurance companies that identify the different groups that make up their electronic payer landscape will have a distinct advantage in raising customer satisfaction.
Source: Insurance & Technology, April 15, 2010

Decreasing Bad Debt is Top Objective in Healthcare
Decreasing bad debt is the #1 objective of the 46 healthcare organizations surveyed by TransUnion. “Our survey reinforced the fact that hospitals and other healthcare-related offices are in search of ways to manage their rising debt caused by the increasing uninsured population, changing healthcare plans and the realities of greater out of pocket payment liabilities for patients,” said Milton Silva-Craig, EVP at TransUnion. This recession is so severe that three out of four healthcare organizations' balance sheets have been more negatively impacted than during the 2001 recession. “What this means for healthcare organizations is that it is more important than ever to develop strategies to effectively manage the collection of receivables from self-pay patients,” continued Silva-Craig. Healthcare providers can increase their dollars collected by allowing consumers to pay by their preferred method, which for an increasing number of consumers is over the phone or the Internet using a payment card or ACH.
Source: TransUnion, April 13, 2010

Half of Financial Professionals Expect Economy to Improve in 2010
Financial professionals expect the U.S. economy to strengthen at a moderate pace throughout 2010, according to the Association for Financial Professionals survey of over 1,000 financial professionals. 45% of financial professionals expect economic conditions to improve this year, 44% expect things to stay the same, while only 11% expect the economy to worsen. These responses have a more positive tone than the 2009 survey, but many respondents are concerned that the economy has yet to achieve sustained economic growth. The financial professionals surveyed are focusing on several factors they believe will have a major impact on the U.S. economy in 2010. These factors are: consumer spending, Federal budget deficit, healthcare costs and access to corporate credit.
Source: Association for Financial Professionals, February 2010 (pdf)