Almost 9 of 10 Companies Face Problems with Existing Payment Systems, New Modern Treasury Research Shows

96% plan to invest in payment operations in the next 12-18 months to save money, improve service, reduce errors

SAN FRANCISCO–(BUSINESS WIRE)–Modern Treasury, a software platform that helps companies modernize money movement, released new research today, conducted by the Harris Poll, showing that 88% of financial decision makers feel that their company faces problems with their payment operations given high rates of payment failures, returns or refunds, a low rate of accurate payment reconciliation, and data quality errors.

Managing payments is still too cumbersome, with 69% of financial decision makers saying it takes too long, up from 61% last year, indicates the second annual “Money’s Next Move: The State of Payment Ops” survey of companies with 500 to 4,999 employees. Four of 10 financial decision makers (40%) describe payment operations as manual, up from 33% last year.

Of the 88% reporting problems with payment systems, approximately one-third cite a lack of real-time insight into cash balances (30%) and experience high rates of payment returns or refunds (28%). Of the 96% of financial decision makers that feel their company experiences negative impacts, nearly 2 in 5 report wasted employee time (41%), greater financial risk (39%), and increased employee frustration (38%). And around a third report that poor customer service (32%) is a negative impact they experience.

“For many companies, payment operations are still highly manual, error prone and too time-consuming,” said Dimitri Dadiomov, Modern Treasury CEO and Co-Founder. “This is not good under any circumstance, but it can be especially limiting when economic conditions are rapidly changing like now. The good news is that almost all companies recognize the need to modernize money movement to improve performance, customer service, and to be ready for more instant payments via the existing Real Time Payment (RTP) network and next year’s launch of FedNow.”

A full 96% of financial decision makers say their company will likely invest in payment operations in the next 12-18 months. The top three benefits that respondents believe their company would experience if they had automated, faster payment operations are: save money in the long run (43%), deliver a better customer experience (41%), and reduce money movement errors (39%).

While consumer payments and credit cards have benefited from vast innovation in recent years, business-initiated payments, which amount to more than three-quarters of all U.S. money movement at an estimated $750 trillion, are still largely reliant on cumbersome, legacy technologies and manual systems.

Almost half of all survey respondents (47%) reported using five or more systems to manage payment operations and 89% use a third-party payment provider, which can further slow payments. In today’s world of instant everything, wires, checks and ACH payments — the primary bank rails for business payments — typically take 1 to 3 days to post.

Shorter payment processing times and having the ability to manage all bank accounts in one platform or system will be the most helpful upgrades to payment operations, indicated 47% of survey financial decision makers. RTP and FedNow may be a big help there. RTP was the first new bank payment rail in the U.S. in four decades and is offered by leading banks. FedNow, backed by the U.S. government, is expected to spread real-time payment capability to more banks, including regional ones, and make real-time payments more accessible to more businesses.

Added Dadiomov, “Modern Treasury was founded to automate the entire cycle of money movement from initiation to reconciliation, and this survey demonstrates a vast need for modernized solutions in what is one of the most important pieces of infrastructure at all companies: payments and money movement. The goal is for companies to move money with confidence and to evolve to truly instant payments so that they have immediate insight into their finances, at all times.”

To read the “Money’s Next Move: The State of Payment Ops” report, please click here.

To learn more, you can also register to attend Modern Treasury’s Money’s Next Move webinar on October 20 here.

Survey Methodology

The research was conducted online in the United States by The Harris Poll on behalf of Modern Treasury among 303 financial decision makers who consist of US adults 18+, employed full time working in a company with 500-4,999 employees that moves and tracks money. Participants must work in finance, accounting, or product development and make financial decisions. The survey was conducted August 11-September 6, 2022. Data are weighted where necessary by employee size to bring them in line with their actual proportions in the population.

About Modern Treasury

Modern Treasury provides payment operations software for companies, enabling teams to move and track money with confidence, and automate the complete cycle of money movement—from payment initiation, through approvals, to reconciliation. Using Modern Treasury products, innovators are reinventing the way businesses are built, run, and scaled. The company is a catalyst for growth in the economy’s most important sectors, from real estate and healthcare to education and financial services. Founded in 2018, San Francisco-based Modern Treasury is backed by leading investors Altimeter Capital, Benchmark, and Y Combinator.

About The Harris Poll

The Harris Poll is a global consulting and market research firm that strives to reveal the authentic values of modern society to inspire leaders to create a better tomorrow. It works with clients in three primary areas: building twenty-first-century corporate reputation, crafting brand strategy and performance tracking, and earning organic media through public relations research. One of the longest-running surveys in the U.S., The Harris Poll has tracked public opinion, motivations and social sentiment since 1963, and is now part of Stagwell, the challenger holding company built to transform marketing.

Contacts

Chad Torbin 

Chad@speakeasystrategies.com