A study on the state of accounts payable conducted by market research firm Levvel and commissioned by Tipalti, the global payables automation solution, has highlighted the ongoing challenges in dealing with fraud as cross-border payments increase in frequency. Levvel Research found that a majority of companies (83%) made cross-border payments in 2019 – a 10% increase over the prior year. However, fraud remains a top concern as firms expand their global reach.
“There’s no denying that cross-border payment processing are on the rise and that they are more complex than domestic transactions” said Anna Barnett, director of Research at Levvel. “Businesses are realising that they are exposed to fraud risk unless they put in place new controls”.
Surveying more than 450 professionals from North American organisations across a variety of industries and market segments, Levvel Research found that 33% of businesses are worried about fraud. Other notable concerns include data security (26%), local tax and regulatory requirements (26%), the challenge of monitoring supplier information for regulatory compliance (23%), and the growing volume of international payments (19%).
The research also found that most organisations make their international payments through wire transfers (69%), which remain attractive despite having very high transaction costs and fast growing fraud risks. This is followed by PayPal (38%), local ACH transfers/global ACH (29%), cheques (29%), and prepaid debit cards (17%).
Nearly a quarter (24%) of businesses recognise that they have a knowledge gap regarding international payments processes, while 26% say they have a challenge meeting local tax and regulatory requirements.
“Many AP departments are struggling to keep up with a globalising market and the changing state of their supply chain,” Amit added. “To survive, organisations need a more modern, efficient approach that eliminates wasted time, manual labour, and errors while putting controls in place that minimise risk exposure”.