Case study: Using technology to remove the payments compliance headache at Johnson Electric
Johnson Electric is working with BNP Paribas to streamline payment compliance enquiries and reduce manual intervention by its European Treasurer. In this case study, we reveal how the bank’s INQUIRO app is transforming multiple payment processes, freeing up time and driving wide-ranging benefits for the global firm.
For companies like Johnson Electric, a global leader in motion products for the automotive, building automation, business machines, defence and aerospace industries to name just a few, the need to improve payment processes and procedures is a high priority. Driven by constant and ever-changing regulatory and compliance requirements, and a need to ensure timely and accurate delivery of payments, the payment management challenge is a big one.
It can also be further complicated when dealing with often very diverse regulatory requirements placed on cross-border payments. As a result, organisations like Johnson Electric are experiencing an increasing number of compliance alerts for suspended payments, and the consequence is that it takes extra valuable time to resolve any issues using the manual processes.
The business challenge
Johnson Electric has a centralised treasury function for Europe and the Middle East where resources are under intense pressure. With payment compliance issues a time-consuming problem, the organisation needed to find a solution.
“I would get all of these emails regarding compliance hits and clearly it’s not my daily job to resolve them,” explained Jacqueline Martin-Purdie, the Switzerland-based European Treasurer for Johnson Electric.
“An increasing number of suspended payments has the potential to cause an escalation in the manual effort required to manage the payments, which equates to operational cost increases and reduction in efficiency.
“One compliance hit would take me a good half hour to resolve – so when BNP Paribas approached me to see if I would be interested in a new digital solution, I of course welcomed the opportunity.”
In response to the noticeable increase in the number of payment enquiries and time taken to resolve payment delays caused by attributable compliance issues, BNP Paribas created INQUIRO, a web-based enquiry app that facilitates digital compliance enquiries between the bank and its clients.
Explaining more about INQUIRO, Vincent Calderara from BNP Paribas said: “In some cases, payments need to go back to their clients in order for more information to be collected about the transaction. Traditionally, this exchange of information happened by email, across several departments. It could take weeks for the bank to collect and receive the information required for the payment to be released.
“Working by email, we also exposed information, as well as losing visibility of the process. There was a lot of frustration, so BNP Paribas wanted to invest in improving the client experience and the process of interrogation around compliance.
“As a result, it was decided to build, in-house, the app-based INQUIRO digital platform that facilitates the exchange of information between BNP Paribas and/or preferred clients.”
Vincent Calderara explains: “INQUIRO delivers transparency about the transactions that require additional information, including exactly when the payment request is sent to a client, when the client has answered, and at what time the bank has considered and validated the feedback from a client.
“It helps to really centralise and manage requests, having the whole exchange on one centralised platform, providing a better overview. In complex cases it helps us know when to intervene and to really give support to a client when necessary.
“Finally, without losing any efficiency, we have really accelerated the process, providing BNP Paribas with the ability to go to the right person first time, and also provide a global overview on what happens in the exchanges between the bank and the end-user.”
From a treasury perspective, Jacqueline Martin-Purdie adds that for Johnson Electric, INQUIRO enables treasury to filter and address enquiries directly to people who could answer – and highlight where the same problem is repeatedly being flagged.
“INQUIRO stops repetitive KYC or compliance hits. If we have the same hit every month, INQUIRO will look into it and, if it’s flagged for the same reason every single time, the problem will be resolved. This stops me from having to say every month, ‘you know what this is, here’s the invoice, this is the reason behind it’. It really makes it a lot easier for everyone, without having to exchange hundreds of emails.”
Jaqueline Martin-Purdie adds: “Further efficiency savings are driven by the fact we’re not waiting for emails to be read, emails can’t be missed and so on. The direct process has been of huge benefit to us. The benefits are global too – queries can now be directed to specific people in specific countries.
When asked how easy it was to set up INQUIRO, Jacqueline Martin-Purdie says it was no problem at all. “The app is extremely easy to use and set up – the team at BNP Paribas really helped so the time I had to invest was minimal. We were the first organisation in Switzerland to use INQUIRO, so there were a few cracks to work out, but the team at BNP Paribas was really good at listening to what we needed and quickly worked through the suggested amends.
“When we started to use the solution, I was the only point of contact, so I would still receive the emails. I could then delegate it to someone else and have them upload the information. Slowly, I involved other people directly so that they could take it over completely. Now I almost never have to intervene in any of the hits.”
No looking back
It’s fair to say that INQUIRO has transformed the payment compliance process at Johnson Electric, saving time, freeing up resources and improving the flow of information.
Jacqueline Martin-Purdie concludes: “I really wouldn’t want to be without INQUIRO now. As well as the benefits mentioned earlier, it also creates an audit trail of who’s done what and where we’re at with payments, so I can see in one place everything that’s gone through. It’s very easy to use, very transparent and has made my life a lot easier.
“We now have a straight through process that runs itself. That’s a positive outcome for our treasury function, without a doubt.”