What is Driving Down the Cost of Electronic Financial Transactions?

December 15, 2015

Electronic Financial Transactions

Do you still process financial transactions manually or even electronically? Do they still seem inefficient or costly? Electronic financial transaction processing is evolving quickly.

Over the years we have seen a minimal reduction in the cost of electronic financial transactions including: electronic bills, invoices, payments, and purchases. The cost of these electronic transactions has only reduced by 20% - 40%. This may seem like a lot, but its minuscule when compared to moving from manual processes to electronic. How much should you be paying? 40 cents, 25 cents or 5 cents?

E-Invoicing, P2P and payment vendors have somewhat commoditized their software and services based on transaction volume over the years. Their margins have slowly eroded. It is the adoption of the cloud that is helping them maintain some sense of being. However, they are not integration providers, and their investment is focused on their business applications and services.

When we think about these transactions, data is extracted in a certain format (say EDI/flat file) from one system or application, the data is transformed to another format (say XML) and then loaded into another system or application. This process is known as ETL (Extract – Transform –Load).

Technology has evolved more than one might think. Imagine if this process could be performed for pennies or fractions of a penny per transaction; not only moving and transforming the data, but providing full status, validation, activity monitoring and analytics. This is only possible with the use of a highly scalable cloud platform like AWS or Azure, and an integration platform designed to process transactions across a value network. One that is multi-tenant, allows process orchestrations, validation rules and reusable end points.

The cloud and modern integration platforms like Youredi have changed how we can now approach electronic financial transaction processing. To learn more, download the free whitepaper provided below. 

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