In the current recessionary economic environment, organizations have intensified their focus on improving their bottom line by reducing costs and transforming their labor-intensive, paper-based procurement and accounts payable processes into automated ones.
P-Cards are perhaps the only solution that effectively streamlines both ends of the procure-to-pay cycle (P2P), while significantly reducing costs and introducing greater levels of control and visibility into spend.
PayStream conducted its annual “Electronic Payments and P-Card Benchmark” research in the first half 2009, to collect data from over 500 enterprises. In current recessionary times, it was no surprise that the enterprises participating in our benchmark survey cited the need to reduce P2P transactions costs (65%) and need to maximize rebates and incentives from card-issuing bank as the main drivers to leverage P-Cards in their organization. Research found that P-Cards Deliver on their P2P Promise!
Figure 1: P-Cards Deliver on their P2P promise!
As displayed in Figure 1, P-Cards have sliced the cost of a single P2P transaction by nearly half. Additionally, P-Cards, on average, lower the P2P cycle times by one-third. In addition to streamlining the P2P cycle, P-Card provides the additional benefit of incentives or rewards (cash backs etc.) from the card-issuing bank. 46% of the organizations participating in PayStream’s research received an incentive varying from 0.5% to 2.0%.
PayStream research also found that even though P-Cards have been in existence for more than a decade, they capture, on average, only 9.3% of the enterprise indirect spend. Significant barriers to adoption of P-Cards exist! PayStream’s benchmark report titled, “Electronic Payments and P-Card Benchmark Survey Report: Bottom Line Savings from Procurement to Finance,” will cover different electronic payment methods, including ACH & P-Cards, focusing on how organizations can overcome their P-Card challenges to realize significant cost saving in their procurement and accounts payable departments. This report shall publish on September 01, 2009.
PayStream will further discuss the findings of the research in its annual summit in Charlotte from September 23rd-25th, 2009. More about PayStream Summit HERE.
