The timely delivery of remittance details is more of a priority for non-US companies than is straight-through processing (STP), while cross-border payments and remittance exchanges are more complex than domestic activity according to a report from Aite Group.
The report, titled ‘Buyer and Supplier: The Exchange of International Payments and Remittance Details’ by senior analyst Nancy Atkinson, examines how companies based outside of the US transmit remittance information to and from US-based companies and also reviews firms’ preferences regarding the exchange of remittance details.
It includes a survey in which respondents are asked: “When your company thinks about using various remittance delivery solutions to receive remittance information from companies in the US, how important are the following considerations?’. The responses were as follows:
- Timeliness of remittance delivery with respect to payment receipt: Very important 69%; Important 23%; Little/no importance 7%.
- Remittance information coming with the payment: Very important 62%; Important 34%; Little/no importance 4%.
- Capability of the solution to provide remittance information in a structured format: Very important 47%; Important 42%; Little/no importance 11%.
- Ability to easily integrate the solution with your company’s systems: Very important 46%; Important 43%; Little/no importance 11%.
- Ease of initiating and using the solution: Very important 46%; Important 39%; Little/no importance 15%.
- Ability to automatically post remittance information without operator intervention: Very important 34%; Important 48%; Little/no importance 17%.
Other findings in the report include:
- Wire transfers constitute the highest percentage of payments made to (41% of respondents) and payments received from (30% of respondents) US-based companies.
- When it comes to how remittance details are exchanged to both payables and receivables respondents, respondents generally comply with the trading partner agreement or mandate (directive) by one company or the other. With US small business trading partners, however, non-US-based companies are reported to make the decision.
- Email is the most frequently used remittance channel for exchange of remittance details for most types of payments.
- When a choice of delivery solution for remittance details is being made, timeliness of remittance delivery with respect to payment receipt is the most important consideration from the perspectives of both receivables.