1、1Scaling Spend ManagementIntelligent and scalable payments for spend management platforms.2IntroductionSpend management software was originally designed to help aid employee and department spending,primarily the reimbursement and management of receipts and expenses.But the world of work has changed.

2、Its now unrecognizable from just a few years ago.The emergence of remote and global teams expanded international supplier and partner bases,a new approach to travel and wider economic uncertainty means that today,the spend management needs of finance teams are more complex than ever beforeespecially

3、 when it comes to payments.As a result,teams reliance on spend management platforms have increased,more options have emerged and the market is growing.Fast.Between 2022 and 2029,its projected to reach$39.05 billion,at a CAGR of 11.1%.However,not all platforms have the infrastructure in place to meet

4、 this long list of new requirements:More cross-border payments Increasingly complex expenses Real-time reimbursements Multiple company cards Evolving AP/AR challenges More competition and fewer differentiators for platforms But with the correct payment infrastructure in place,platforms can level up

5、their offering with direct payments,automatic reconciliation,virtual cards,seamless cross-border transfers,and more,all while reducing payment costs.This,in turn,will not only mean that they can aid businesses and their employees further but also scale their businesses at home and abroad.Why the spe

6、nd management space is growing at such speed The payment issues holding platforms back How new payment technologies can solve the issue How to improve your platform with the right payment partnerIn this guide,well explore:3A growing and evolving market According to one study,European businesses lose

7、 301 billion every year due to poor spend management.This is clearly bad news for business,but a lack of spend management takes its toll on employees too.Clunky or manual expense uploads or a lack of adequate payment infrastructure can result in lengthy reimbursement times and financial stress for e

8、mployees.This,in turn,is more bad news for businesses as 76%of employees state financial stress as a reason for looking for new employment.Platforms that have remedied these problems have proven very popular.But already,those problems have grown and evolved.Now platforms are facing a new raft of cha

9、llenges to solve.Here well explore how the working world has changed in more detail and how this is shaping a new era for spend management.A post-pandemic shift in focus Before the pandemic,spend management was primarily focused on travel and entertainment(T&E)that is,the expenses accrued by staff w

10、hile traveling for work.But once COVID-19 hit and travel stopped,finance teams were able to shift focus towards pain points other than receipt collection.Businesses were then able to examine how partners and suppliers were paid,departmental spend,the use of company cards,and their approach to AP/AR,

11、with many finding that the current approach just wasnt working.The amount European businesses lose every year due to poor spend management.301 billionFrom here,many realized that the need for a software solution wasnt just a nice-to-have but a must-have.4Remote workforcesUndoubtedly,the biggest work

12、 shift of the last few years has been the adoption of remote working.In 2019,just 17%of global employees worked remotely.Today,32%are now entirely remote,with 51%working in a hybrid work/home environment.Not surprisingly,this has impacted finance teams significantly.Ninety-seven percent of AP depart

13、ments were affected by the shift to remote work,with 28%reporting an“extraordinary”or“significant”impact.32%of global workforce are now entirely remote.The shift has led to changes to both the number and nature of expense requests.While travel expenses have returned,employees now face a barrage of n

14、ew expense requests to meet remote workers needs.Among U.S.employers,the Society for Human Resource Managements(SHRM)2022 Employee Benefits Survey found:95%of U.S.employers cover costs related to work technology,such as computer monitors,keyboards,or headsets 68%cover costs related to general office

15、 supplies such as pens or notepads 24%cover the cost of chairs for employees working from homeAn earlier survey from SHRM found that employees spent an average of$194 on remote equipment.This is on top of regular T&E expenses.Real-time reimbursements are now essential to make sure those team members

16、 arent left out of pocket for long.The decline of the company cardThe continuation of remote work has also transformed a decades-old staple of office spending:the company card.Whereas in the past,the card could be lent out to in-office departments before being safely returned,now businesses must eit

17、her send the details out to different employees or ask them to take care of the payments themselves.The former option is a security risk and increasingly complex considering the checks many banks now have in place for online card payments,while the latter is simply an unfair ask of employees.As a re

18、sult,many top spend management platforms provide multiple physical or virtual company cards issued to individual employees and departments or even just for one-off purchases.This is a double bonus as it also reduces the number of expense reimbursements.5Global teamsWith remote work now the norm,hiri

19、ng local talent is no longer a priority.Companies can look far and wide to find the best and brightest.According to a Nium survey between 2020 and 2021,the share of firms that expanded their hiring of international workers grew nearly six times,from 8%to 46%.8%46%Whereas previously,expenses accrued

20、abroad could be paid back in the home currency,overseas workers now require localized payments.For businesses and employees,this increases the need for good FX rates and cross-border payments that avoid the charges and delays accrued by SWIFT(Society for Worldwide Interbank Financial Telecommunicati

21、on)transfers.6Payment challenges in the new landscape As the market has grown and evolved,so have the payment challenges.Helping businesses and employees solve them has the potential to be a key competitive advantage for spend management platforms.Lengthy reimbursement times The growing size and var

22、iety of expenses mean employees need to be reimbursed immediately.Despite this,one third of staff still wait over a month for expense reimbursement.Not only is this unfair to the employee,but it puts the business at risk of losing them,with 76%of financially stressed employees admitting to being att

23、racted to other companies.Inefficient cross-border payments As businesses(and the platforms they use)expand into different geographies and further internationalize their workforces,they must be able to make quick and cost-effective cross-border payments.Eighty percent of firms report experiencing ch

24、allenges when paying their international workers.This,in turn,drives more firms to use costly private agencies to help with worker hiring and management.Manual and slow AP/AR Despite advances in technology,a large number of firms are still taking a manual approach to AP/AR,with 33%of businesses stil

25、l entering invoice information manually and 26%still receiving paper invoices.This slows down the process and is also costly and error-prone.7Payments upgrade essential to stay competitive While this changing landscape presents a range of payment challenges,it also represents an increasingly signifi

26、cant opportunity for spend management platforms that seize the initiative.Stand outAutomateSupportfrom competitors with virtual and physical cardspayments in a way that works for your brand and clients clients by removing strains on their timeExpandUpgradeacross bordersoffering with innovative new f

27、eatures8Take platforms globalA truly localized payment offering should not only provide real-time payments in multiple currencies via local and international payment rails but also be entirely compliant with local regulations and have access to competitive foreign exchange rates.Once this is in plac

28、e,platforms can target global businesses and businesses with global workforces.They can help clients reimburse employeesno matter where they are locatedin real-time,in their chosen currency and to their chosen bank account or wallet.Platforms can also support businesses with unbanked employees or su

29、ppliers that require payments to be made direct to card,or into digital wallets.This is a huge opportunity as businesses of all sizes now have cross-border payment needs,presenting a big opportunity for platforms.Larger enterprises may need tools that plug into legacy systems and processes,while sma

30、ller businesses may not be equipped for the additional lift required for managing cross-border payments.Support real-time reimbursements Today,being able to help businesses keep their employees and suppliers satisfied with speedy reimbursements is a vital differentiator when looking for spend manage

31、ment solutions.This is because businesses existing payment methods,such as wire transfers,are often ill-equipped to keep employees and partners satisfied,especially for cross-border payments.These transactions pass through an average of six financial institutions(FIs),and wire transfers can take as

32、long as five days to arrive.While transfers through the SWIFT network are often slow and incur sizable fees too.9Automate AP/ARThe most prominent AP/AR challenges facing finance teams are:33%Manual data entry23%Invoice-to-payment matching23%Lost and duplicate invoices20%Inadequate or outdated techno

33、logyTo tackle these challenges head-on,93%of CFOs are currently digitizing their accounting operations.Therefore,above anything else,spend management platforms must have the infrastructure to help automate and digitalize AP/AR by providing businesses with the correct tools.10As teams grow and work r

34、emotely,the need for multiple company cards increases.By providing employee expense cards,platforms can help businesses massively optimize their expense management.These changes alone can save businesses time and drastically reduce operational costs,as real-time updates allow companies to track and

35、manage expenses as they happen.Furthermore,these cards can all have individual spend controls with unique authorizations and limits on how much and where employees can spend.This has clear benefits when managing company spend but can have a broader impact too.Offer multiple virtual and physical card

36、sof business travelers already use virtual cards for expenses.37%Virtual cards will play a vital role in this new company card era.Thirty-seven percent of business travelers already use virtual cards as their primary financial source for expenses,with over half looking to increase their use over the

37、 next five years.Virtual cards can be instantly issued for any purpose and then deactivated immediately after,making them particularly resilient against fraud.They can even be issued for specific suppliers and merchants.To make all these upgrades,platforms need to partner with the right payment solu

38、tions to enable their business to grow.11Scale your spend management platform with NiumScaling your spend management platform requires the right payment experience.This means using payment rails to deliver the experience businesses and employers expect in a way that differentiates your platform.Whil

39、e platforms can theoretically build their own rails,compliance,and security infrastructure,the rapid pace of expansion and the challenges involved make this unfeasible,expensive,and slowespecially when serving global businesses with global teams.Banking regulations are strict and complex.It is vital

40、 to work with a partner who is a licensed electronic money issuer(EMI)10 or the local equivalent,one who can hold client funds securely and ensure the necessary anti-money-laundering standards are met for international transfers,with Know Your Customer(KYC)and Know Your Business(KYB)information in p

41、lace.This is where Nium can help.12 Automated and real-time reconciliation By digitizing their entire financial system,businesses can streamline and automate their reconciliation.With each transaction,Nium automatically logs the transaction,approval history,receipts,and more so businesses no longer

42、have to while providing real-time reimbursements.Nium is the global leader in on-demand money movement.Platforms can harness Niums payments technologies to tackle new business needs,compete and scale while employing a highly appealing business model for would-be customers.Niums comprehensive suite o

43、f APIs(application programming interfaces)enables platforms to offer businesses multiple modern money spend management services including:Virtual and physical cards Via Nium,platforms can provide businesses with physical and virtual cards for employees,complete with spend controls and personal login

44、s.Plus,as Nium is a Visa Issuer,businesses can move from onboarding to issuing cards in four to six weeks.Cross-border and localized payments True global connectivity requires building individual links with banks,obtaining payment licenses on a territory-by-territory basis,and optimizing onboarding

45、as well as maintaining that infrastructure in the face of new technology and regulation.Nium has those relationships in place and supports bank-to-bank and wallet payments in over 190 countries,100 in real-time,100 currencies,and holds licenses in 11 jurisdictions.13Visit NTo learn how to level up your spend management platformand book a consultation with one of our experts.