Towards a Paperless Payment system.

May 2002

At a time when the sluggish economy is spelling doom for most local companies, managers are being challenged to seek innovative ways to cut operating costs and increase efficiency.

Indeed, technology offers solutions that enable corporate organisations to improve efficiency. But it is often hard to find solutions to lower operating costs and increase efficiency without corresponding higher cost, especially in managing cash flow.

These are some of the questions most managers ask often;

• Is there no better way of managing bulk payments through the bank without having to write, sign and send out hundreds of cheques each time?
• How do I manage the security of cash for paying wages/salaries to employees who don't have bank accounts?
• How do I prevent - or minimise – fraud through cheques? Should customers receive and draw the cheques my company issues? Will my company receive all cheques from customers?
• With the increased cases of cheques lost or diverted in transit, how do we protect ourselves and ensure that only the intended beneficiaries receive our payments?
• How can I manage the receipt of value from the bank in a more transparent manner?
• H ow can I avoid data re-input and recapture? Isn't it tedious, takes too long and introduces errors in processing?

If you have been pondering over these questions, then you need to consider electronic financial solutions that have revolutionised the way payments are originated by the corporates, transmitted and processed by the bank. Both parties can realize lower operational costs and enjoy a host of other benefits, which are now made possible by new technologies that don't require you to sign cheques.

The new technologies are e-business solutions for the management of large transactions with easy-to- use software that connects clients directly to the bank, enabling the transmission of data, schedules or payment instructions electronically. What is even more appealing is that there is no additional cost for software and training.

They provide quality service to companies and increase the quality of service and product. For instance, the Zimbabwe financial sector now has eight leading local and international banks providing electronic banking services to more than 750 corporate customers using paynet, an e-business solution for the management of large volume transactions. African Lakes Technologies has established a similar business in Kenya, with already more than 60 companies connected to the paynet service.

The existence of an efficient central clearing system used by all banks means that paynet is freely available to any business. All they need to do is transmit the data/schedules through a paynet-enabled bank, and the payments can be channeled to other corresponding banks through central clearing.

Extracted from an article authored by Renee Kiamba – Former Business Development Manager.

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