Expense Data Seeks Use Cases Beyond Employee Spend Control
Managing employee spend is an arduous process that traditionally involves a lot of paper. Indeed, the physical receipt has been a point of friction in the expense management process for years, leaving travel and entertainment (T&E) innovators room to tackle the pain through technology.
An increasingly common strategy to address the paper receipt headache is to implement optical character recognition (OCR) technology, which requires employees to take a photo of a receipt to digitize its data. In today's contactless world, however, this is no longer the most effective strategy, according to Myver Senior Advisor Jesper Ronald Petersen.
"We all have a good idea of how many hours accounts departments across the world spend on verifying and stapling together paper receipts and handling all of this paper," Petersen told PYMNTS. "It's a complete nightmare."
Myver aims to ease this problem through direct integrations that can capture spend data directly at the point of sale (POS), whether online or in person, regardless of payment method.
There is intrinsic value for corporates in doing away with physical or digital receipts in favor of automatically capturing, categorizing and connecting spend data into back-end systems. Yet as Petersen described, there are additional value-added opportunities for both employers and the retailers that sell to them that can be found within spend data.
Doing Away With Receipts
According to Petersen, today's expense management technology is based on outdated workflows.
"Everybody in the market today either bases their system on physical receipts, or the most innovative make it digital by taking a photograph of a physical receipt and then submitting that in," he said. "That's completely ancient. Nobody wants to touch physical receipts these days."
Myver has instead patented a solution to capture information at the moment of purchase and allow for that data to be integrated into a variety of back-office platforms, from expense management portals to enterprise resource planning (ERP) systems.
By cutting out the "middleman" of the receipt, whether that document be physical or digital, organizations can more efficiently obtain a holistic view of employee spend, reinforce controls and combat fraud. Traditionally, manually managing data from receipts and verifying purchases is an accounting department's first line of defense against expense fraud.
"It really is a double-edged sword," said Petersen. "You don't want to get defrauded, but you also don't want your accounting department to have to spend time handling fraud."
According to Petersen, a single expense report can take as long as 25 minutes for finance professionals to review and process in order to ensure employees have made authorized, legitimate purchases and to facilitate any reimbursements. Direct data integrations between payment solutions like cards, and back-office portals like expense management tools, can cut down that manual review time while promoting control and security, he noted.
An Upselling Opportunity
The efficiencies gained from direct spend data integrations are certainly valuable for employees and their employers looking to gain a better hold on workers' spending habits. But what expense management solution providers in the market today are missing, Petersen said, is a way to wield that valuable transaction data for the merchants themselves that sell to businesses and their employees.
There are valuable upselling opportunities that can be gained from understanding not only what an employee purchased, but when, and looping in additional information about that buy. Petersen offered one example of the purchase of a vacuum. Six weeks later, that purchase data can be used to automatically present an offer to the buyer for replacement vacuum bags.
In the corporate expense arena, this can be especially useful in the purchasing category of electronics that come with limited warranties, information that is often kept on the receipt itself. Through direct data integrations and digitization of that receipt data, not only can employers obtain electronic documentation of product warranty information, but merchants can automatically send reminders about warranty expirations and present offers to renew a plan. Similar opportunities exist in presenting businesses with financing products, too.
"This is where the hammer meets the nail," said Petersen. "Everybody wants to have frictionless payment solutions, but you don't want the receipt physically."
Exploring new use cases of spend data for employee, employer and merchant is the future of expense management, he added, particularly as payments continue to digitize, physical receipts fall by the wayside, and data integrations grow more flexible and sophisticated. Wielding this information in new ways is also ushering in a new era of corporate spend in which the purchasing process is optimized and more intelligent, an achievement that will be paramount for professionals demanding a better experience while working from home or on business trips.
"The data created by capturing all of these receipts will be massive," said Petersen. "All of a sudden you have a very personalized customer experience, and an upselling opportunity for the retailer and finance companies."