FIS Modern Banking Platform
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August 3, 2017
David Johnson, Senior Vice President, Emerging Commerce Products
Companies of all sizes have daily needs for which employees must purchase goods and services. But transferring the funds so that expenses reconcile quickly and efficiently has been anything but easy. Similarly, when families, non-profits and community groups informally collect funds, sharing that money can be difficult. Traditional credit and debit cards, checks and even cash solutions can be inefficient (and often inappropriate) ways to transfer funds. Fortunately, ongoing technology advances are coalescing to offer consolidated funds-sharing solutions that offer transparency, security, simplicity, and flexibility for groups of all sizes, across all sectors.
Consider the small business owner who needs employees to submit their travel finances and expenses to the company, parents needing to fund a child’s book purchases while away at college or families needing to fund a caregiver for an aging grandparent. Even a community organization that needs members to buy basic goods for a local event. In every instance, the individual buying the good or service could struggle.
The problem is that the payee might not be able to cover the bill until the expense is repaid a month later, or the recipient may not have a bank account to transfer funds into. Issuing a named credit card, or worse, sharing the corporate credit card, may not be a viable option. In some cases, gift cards are used, but that can result in reconciliation problems with unspent balances, no visibility into the balance and purchases, and crumpled or lost receipts. Far too often, the solution is to raid the petty cash box in order to hand out funds.
While it’s a priority to have the funds available when and as needed, it’s equally important to ensure those funds are used for their intended purpose. Then, transactions need to be logged, reported and reconciled properly. Church groups, non-profit organizations, sports clubs, university fraternities and sororities could all benefit from improved funds management solutions that encourage the funds to be distributed in a controlled, instant, affordable and accountable manner.
Whether a small or large business, a family group, or a community organization or club, prepaid solutions provide the visibility and control to manage finances in a responsible and seamless manner.
It is a simple concept: all funds go into a single primary account. The funds can then be shared with the members as needed, under the control of the administrators. As end users need money, funds can be moved to a user’s personal prepaid card, or the money could be sent to a smartphone wallet. Using the web or a mobile app, everything can even be done in real time. After a purchase, excess funds can be returned to the master account, and administrators can suspend, close or reinstate a card at any time.
Improved funding and financial expense management provides groups with greater efficiency, speed and security, and provides them with a higher degree of governance. Modern funds-sharing solutions give group administrators more control over how members use funds. That’s because prepaid mechanisms can restrict the types of transactions funds can be used for, or apply limits to how much is spent and where. Individualized limits also can be set so that different users have different allowances to match their needs.
Receipts for purchases can be appended digitally along with transactions for reconciliation simplicity, and these can be transferred to accounting systems for any tax reporting or audit purposes. This encourages the propagation of sound financial practices, and administrators can monitor everything at any time to confirm that best practices are maintained.
Prepaid solutions offer an elegant and feature-rich alternative to sharing funds across a network of individuals. With modern web and smartphone app-based management, the ease and speed with which funds can move has radically changed and expanded the potential of prepaid funding. This has resulted in an expanding potential client base as new use cases migrate. Once the reserve of banks, an increasing number of disruptors are offering prepaid solutions with retailers and new entrants expanding and strengthening their existing customer relationships and promoting their ties to the local community, broader brand distribution; providing discounts or rebates, and a new loyalty offering.
Available for all sizes and types of people and organizations, commercial or not, modern prepaid funds management solutions are seeing a new renaissance. Payments have never been easier or safer. Expect these services to continue to grow as more sectors become aware of the possibilities.
Senior Vice President, Emerging Commerce Products
DJ is the Product Division Lead over Loyalty, Prepaid, EBT – Government and Merchant Products. DJ joined FIS in 2007 and has over 20 years of payment industry experience with roles in product development, strategy, consulting and business development. Before FIS, DJ managed Online Banking and Bill Pay for a Top 15 US bank. DJ earned his MBA from Emory University and a degree in Finance from the University of Florida.
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