To help small businesses cope with the cumbersome tasks of preparing and paying invoices, $61 billion-asset Bank of the West Bank of the West, San Francisco, is working with CashEdge to develop an online invoicing and payment solution for its small business customers that will help them automate these typically manual endeavors. “We can take some of the complexity out of the payment requirements and the infrastructure businesses need to send payments,” says Matt Macomber, Bank of the West’s multi-channel banking manager. Small business owners make an average of 20 – 50 payments per month, and most payments are made via check or wire transfer.
The new site won’t require small businesses to use their account number to log in — they can use an email address or a phone number as a token ID. The site include a payables dashboard that will show all of a company’s outgoing and outstanding payments. When a customer sends payments, he can attach an email with his company logo and payment information and he can also send out official-looking invoices, logo and all. The service will accommodate multiple payment options, including batch and recurring, and it will allow customers to manage payees and roles. Recipients can pay the invoices using CashEdge’s PopMoney service.
The new service will be embedded in Bank of the West’s small business banking website and integrated with its checking account system. Macomber views this technology as critical to growing the bank’s small business segment.
Although banks commonly offer online bill payment to consumers, they’re just getting their feet wet in offering such services to small businesses. “Banks have been focusing on consumer online banking and at the other end of the spectrum, because of the organizational structure, they focus on the larger end commercial market,” says Catherine Palmieri, global head of product and marketing at CashEdge and former executive vice president and general manager at Citi, where she was responsible for Citibank.com, Citibank Direct, and CitiMobile. “In some ways, small businesses were caught in no man’s land. They weren't commercial and they have greater needs than the consumer.”
CashEdge will provide a risk management feature that monitors transactions and compares them against a database of multiple financial institutions’ activity to find fraudulent transactions and patterns of behavior, ideally identifying and stopping risky transactions before they're able to conclude.
Bank of the West is working on entitlement features for the new service. “Often you want your accountant to be able to see things and pay bills, but you might have an employee you want to give read-only access to,” Macomber says.
On the critical matter of security, Macomber says he derives comfort from working with CashEdge, which processed $50 billion in fund transfers last year. “We'll continue to offer the same security we do on existing platforms,” he says. “Security is always a concern, and certainly when you’re talking about payments and ACH you have an added level of concern.”
The bank stresses to small businesses that they must keep their antivirus software up to date. It has other steps planned (but is not publicly talking about yet) for helping small business customers to keep their computing environments more secure that it will roll out in advance of the new platform debut sometime in the first half of next year. “Banks should be consistently reminding their customers, business and consumer, to keep their security mechanisms up to date,” he says.