International Payments Electronic Funds Transfer
World Moving to Electronic Payments
According to a survey by the Association of Financial Professions, US corporations are rapidly moving to electronic funds transfer for business-to-business transactions. The reasons given for the surge is advances in technology, increased focus on business improvement, and the need to make international payments in a global economy
In 2004, 81% of B2B transactions were paid by paper check. By 2007 this number had dropped to 74%. Today, only 57% of corporate B2B payments are made with paper checks.
In the coming 3 years, the use of paper checks will decline even further. Half of the businesses surveyed said they plan to convert major suppliers to electronic payments within that time frame.
New Technology Now the Norm
New technology that allows for the rapid electronic clearing of paper checks has lessened the old advantage of paper checks, which was additional float time. Paper checks are now seen more as a expense than an economic benefit to companies.
International payments with electronic funds transfer has long been the norm in other parts of the world. For example, in Europe and Asia, paper checks are seldom used. And in countries like Finland, Germany, the Netherlands and Poland, paper checks are never used.
International payments with electronic funds transfer is vital to companies that wish to compete successfully in global markets.
New international payment banking platforms link together the bank networks of many countries into a single, easy-to-use system.
For smaller, non-time sensitive transactions, these platforms will replace wire transfers because they are cheaper and offer far better tracking and reporting capabilities.
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