The first businesses in the Middle East and Africa region have started to experience the seamless ease of Mastercard’s Track Instant Pay solution, in partnership with pan-African fintech enablement partner, Ukheshe Technologies.
Track Instant Pay is a next-generation virtual card solution that uses machine learning and straight-through processing to enable instant payment of supplier invoices – believed to be the first of its kind.
“It safely and intelligently authorises immediate payments to a supplier once a supplier submits an invoice,” says Paul Selibas, president: channel solutions at Ukheshe. “First, it analyses received invoices using sophisticated machine learning to identify those likely to be rejected, then authorises the rest for payment on the same day.
“These payments are sent digitally, directly, and securely to the supplier’s bank account via a Mastercard virtual card. It eliminates all the usual manual processes, from verifying and manually approving invoices to manual payments or lengthy check processing.”
Improving the bottom line
Mastercard’s whitepaper on this new solution revealed that extended payment terms and late payments create a long-standing point of friction between buyers and suppliers. Even virtual cards, in theory a great solution, have not eased these pain points.
According to the paper, suppliers receive an email indicating they have a virtual credit card payment. The supplier must click a hyperlink from the issuing bank, log in and manage credentials to that bank account to see the full number.
They then see a list of invoices that are being paid in a different portal. Next, the supplier must key that transaction into its own system. Overall, this is a highly manual and expensive process, and Mercator estimates that roughly 90% of virtual card transactions are processed this way.
Furthermore, a 2020 study of SME suppliers in the UK showed that the average SME supplier was chasing five outstanding invoices at any point in time, eating up 1.5 hours per day.
Says Selibas: “Within emerging markets across Africa and the Middle East, there is a specific and growing need for a system that can facilitate corporates in paying multiple large municipal bill payments at once, and this solution addresses that on all fronts.
“It benefits every involved party – it unlocks cashflow for suppliers who usually suffer lengthy payment terms or late payments; saves valuable time, costs, and working capital for buyers; and it removes friction to improve business relationships.
“Buyers can manage their working capital more efficiently using the credit line tied to their commercial card account; while unique, dynamically generated virtual account numbers with layers of control provide enhanced security for supplier payments.”
The way forward
Ukheshe and its turnkey Eclipse platform is already Mastercard’s preferred implementation partner in South Africa, having successfully launched Africa’s first Mastercard virtual card for use on WhatsApp last year. The card giant once again appointed Ukheshe as its partner in this solution.
Anton Coertzen, CCO at Ukheshe, says this type of technology could change the business landscape forever. “Mastercard’s solution, combined with Ukheshe’s Eclipse platform, can change the way businesses manage payments – saving time, money and energy for all parties involved.
“With Eclipse, we can add new services to our clients’ suite so that it grows with them when their needs, and those of their own clients or suppliers, change over time. It fits perfectly into Ukheshe’s vision of fintech enablement, modernising business-to-business transactions, and financial inclusion.”