MasterCard and Basware have introduced Basware Pay to connect buyer and supplier payment processes and allow working capital optimization. The new process stems from the rate at which businesses admit to delaying payments to suppliers. In the past 12 months, 57% of surveyed international businesses have actively paid suppliers late, according to the companies’ recent research. Additionally, three of four businesses said they consider this a normal practice—which is hindering small and medium-sized enterprises (SMEs). Basware Pay helps buyers manage their cash flow and suppliers get paid sooner.
Basware Pay adds to Basware and MasterCard’s existing relationship and offers a new solution to optimize working capital. The system prolongs the value of the purchase-to-pay process by using a global e-payment solution—connecting buyers’ and suppliers’ payment process through the Basware Commerce Network. Suppliers’ invoices are sent through the Basware Commerce Network, are approved by the buyer, and then become available for payment through a virtual MasterCard account number. The supplier receives an early payment, while the buyer usually has extended payment terms.
MasterCard and Basware surveyed more than 1,000 strategic decision makers for its “Creating Payment Energy” study. The top findings showed that 88% of respondents agree that suppliers should be paid promptly. However, 74% of decision makers think late payments will always happen, although 90% acknowledge that payment delays have greater repercussions for businesses—such as the ability to pay staff; 67% said they have used payment terms to help manage cash flow, and only one in four businesses reported having an automated process to manage payments.