Billtrust has long relied on its sales force to approach businesses directly with accounts receivable technology, and it's turning to banks to automate more steps in the process of handling payments.
Billtrust's first partnership is with KeyBank to launch KeyTotal AR; the bank will also make an undisclosed investment in Billtrust. Banks have offered payment execution traditionally, but this new product aims to automate invoice delivery, payment and cash application.
"I've never been a big fan of having yet another product on the shelf for a bank to resell if they have interest," said Flint Lane, CEO and founder of Billtrust.
The accounts receivable function is changing rapidly, challenging companies to rapidly respond to new ways to process transactions and travel, procurement, payroll and other corporate functions respond to digital, Lane said. "AR departments aren't going to want a multi-vendor solution."
KeyBank did not provide an executive for an interview. KeyBank is dedicated to adding technology make AR payments smoother, Lane said. As Billtrust seeks additional bank partners, it will look for that type of focus on automating and boarding AR technology, he said.
"Our model will be the same, we're not looking to amass 50 banks just for the sake of having 50 bank partnerships," Lane said.
The Hamilton, N.J.-based Billtrust has been building out its technology over the past couple of years. The company acquired Open Scan Technologies, which creates software that imports information from remittance forms, reconciles the data and then applies it to major business management systems such as Oracle.
Later Billtrust built software to manage virtual cards, routing payment instructions from banks and accounts payable departments to Billtrust for processing. As single-use digital cards increase in popularity as a security play and a way to manage expenses for travel and entertainment, the amount and frequency of information flow increases.
"One recent trend we have seen is more virtual cards," Lane said. "It's tough for a [travel] department to get lots of emails each month, all with [one-time] use credit cards."
The collaboration with banks will also allow Billtrust to scale rapidly by adding to its addressable market, a helpful move given the widely varying accounts receivable needs of businesses, particularly smaller enterprises that may not see the financial benefit of doing business in a different way.
"The business advantage of AR automation for most companies is to improve cash flow by streamlining the billing/invoicing process and electrifying the receivable payment process," said Brad Margol, a principal at AZ Payments Group. "Some businesses can see significant savings, others not so much."
Many smaller businesses still do not want to pay discount fees for accepting credit or debit cards through the supply chain, Margol said. "It's a different mentality than consumer retail and B-to-C where the business will bend over backwards to get, keep and delight a customer. Additionally, the number of B-to-B transactions for a supplier is usually much smaller than a B-to-C retailer so the benefit does not appear as great."