Full steam ahead towards the future of frictionless payments

Full steam ahead towards the future of frictionless payments

  • Paying Here & Abroad

As 2022 draws to a close, it is well worth going through the innovation roadmap of BNP Paribas Cash Management, highlighting what has been accomplished this year, and what we look forward to in 2023 and beyond.

The world is changing at incredible speed, and BNP Paribas’ ambition is to accompany its clients in their transformative journey towards innovation. The foundations for instant and frictionless payments having been laid down, BNP Paribas continuously improves and adds to these foundations.

 

Instant payments are gaining ground all around the world, and in Europe, where they now amount to 13% of all SEPA credit transfers, BNP Paribas deployed its instant capabilities in 5 additional countries this year. The uptake of this payment means is expected to at least double in the coming year and  to continue onwards thanks to a little push from the European Commission’s new legislative proposal to increase global adoption and make SCT Inst the new standard.

 

In Non-EUR countries, domestic schemes are also growing: faster payments in the UK increased the amount limit to GBP 1M, Switzerland announced the launch of a new instant scheme in 2024, and Nordic countries are also actively preparing  for the launch of instant payment in Norway next year, followed by the deployment of the new P27 payment infrastructure, which, among other things, will enable instant payments in Denmark and Sweden. 

 

Market infrastructures are preparing for a frictionless future, through several initiatives. P27 is a first example, but the most prominent one is the migration to ISO 20022 format for interbank exchanges - a major change in the payment industry! The adoption of this format will ensure the exchange of richer data in payments and thus more efficient and real-time processing.

 

BNP Paribas is very much committed to reducing friction in payments, including international transactions. Real-time tracking of cross-border payments through SWIFT gpi is now available in 20 of its markets. In Connexis Cash, an increase of 65% in the number of accounts using Inbound Tracking to track incoming payments has been witnessed, for which BNP Paribas now also offers an email alert functionality, for users to be informed of any updates instantly.  

 

The Bank is also part of the Immediate Cross-Border IXB project, an industry initiative aiming to make EUR and USD instant payments between Europe and the US a new reality in 2023. Fraud being a major concern, BNP Paribas is also deploying pre-validation services, to ensure the validity of the beneficiary account information by connecting to several Confirmation of Payee schemes throughout the world, and this will soon be enriched by SWIFT’s pre-validation API service, allowing for a comparison of  beneficiary data with SWIFT’s transaction database as well. Thanks to the use of Artificial Intelligence, clients can rest assured of the highest level of anti-fraud measures.

 

Treasury centralisation is of course still high on the treasurers’ agenda, and corporates no longer hesitate to turn to virtual account solutions to help them in this strategic transformation. After multiple successful customer implementations since 2020 within the Bank’s initial geographical scope, several additional countries will benefit from BNP Paribas’ Virtual Account Management platform in 2023. Clients will continue to benefit from BNP Paribas’ advisory support to engage in that journey thanks to the Bank’s experience with 300+ payment factories.  

 

With a paradigm shift in the B2B space, in which e-commerce and marketplaces are quickly taking a more prominent role, B2B buyers and sellers both want a more seamless end-to-end experience. Consequently, payment means that are popular in the B2C sector are now entering the B2B sector.

 

Digital payment initiation solutions, such as BNP Paribas’ Instanea, are on a spectacular rise, allowing companies to digitise and be more in control of the receivables process. Adapting treasuries to this new trend is the perfect opportunity to review and streamline the entire order-to-cash and procure-to-pay cycles and find more efficiencies, and as a major international bank, BNP Paribas can fully assist corporates in this process.

 

In the current economic context, optimisation of working capital, through reduction of Days Sales Outstanding and increase of revenues, is undoubtedly becoming critical. This is one of the reasons why BNP Paribas has been developing a Buy Now Pay Later solution specifically for B2B, which is scheduled to launch in early 2023 in collaboration with Hokodo.

 

With e-invoicing initiatives being deployed in several European markets, it is the Bank’s strong belief that SEPA Request-to-Pay - another milestone to look forward to in 2023 – will be the perfect add-on to e-invoices to provide an enhanced digital experience for invoice collection and automated reconciliation.  

 

All of this is testimony to how hard BNP Paribas teams are working to bring value to the Bank’s clients and to build a better future for them.