ABT-ACTE Russia Educational session: the Russian market has already felt the advantages of corporate payment solutions

The second ABT-ACTE Russia Educational session that was devoted to corporate payment solutions in Russia was held in the Red Hall of the Metropol on October, 7. The event was the continuation of the summer session where business travel experts discussed corporate payment cards for personal use of the staff. This time the meeting was devoted to centralized accounts for travel service payments, ways of integrating these instruments with internal systems of the company and their advantages.

Participants of ABT-ACTE Russia Educational session «Corporate payment solutions. Requirements. Practices. Expectations» were heads of travel departments, travel managers, purchase experts, administrative directors of AFI Development, Kaspersky Lab, Roche, Bank Petrocommerce, BNS Group, Oriflame, AlfaStrakhovanie, KPMG and many other Russian and international companies.

Partners of the event were ART-TOUR DMC, «Planet Sochi» Tourism Union, HRS.com, the international provider of hotel solutions, UTS Group business travel agency, luxury hotels network The leading Hotels of the World, Accord transport company and American Express Bank LLC.

In any company all the information about travel transactions — where, when, how much and what for the traveller has spent — is used in accounting. But the reality is that employees of most companies still add this information into their financial system manually. At the same time «advanced» payment solutions are already present in the Russian market, allowing to add all the information on the transaction to the bank and the point of sale in the digital form right at the moment of transaction. Andrey Zaprudnov, commercial product director of Visa spoke about the advantages of such technologies and their integration with automatic company management systems.

«The process of data transmission starts when the company orders the program of corporate payment solutions from the bank. The bank issues cards — virtual or in plastic — and gives them to the employees of the company who in turn use these cards to pay for various types of expenses, according to their internal policy: for example, air tickets, accommodation or purchases», Mr Zaprudnov described the stages of the process. «Then the data on transactions is transmitted to the bank that with the help of Visa transfers it to the company in digital form».

The expert also explained that if the company used the single account to pay for a certain type of expenses of several employees (the so called lodge-card), it gives it an opportunity to get detailed data not only from the bank, but from the TMС as well. In this case the agency makes payment for air tickets or services it has booked on behalf of the company, using the number of the centralized corporate card.

Alexander Safonov, Team Leader Sales of American Express Bank spoke in more detail about centralized payment solutions that are present in the Russian market using the example of BTA (Business Travel Account). In the opinion of the speaker, the need for a lodge-card or a virtual credit card to pay for corporate events and business trips of all the employees through authorized agencies is realized by more and more companies nowadays. It is explained by the fact that according to the company’s internal policy and due to possible risks far not all employees are provided with their personal corporate cards. As a rule, such payment instruments are offered only to employees who go on business trips often and/or have a high status.

According to the expert, introduction of BTA in the Russian market was accompanied by considerable optimization of this product, in particular, by its customization. Abroad the main sources of information on transactions are booking systems — the data that is entered is enough for accounting and financial departments of the company. «But in Russia there is the need for more detailed information, so the core component of our program is the implementation of the connection with the TMC, data exchange and its return to the customer in detailed form», Mr Safonov notes. «At month-end the agency and we provide the correct data to the customer».

The problem of variance of data provided by the TMC and bank reports has been solved. Frequently transactions that were made, for example, on the 30th instant are not processed by payment systems till the end of the month, so the amount in the bank statement of the centralized account is smaller than that in TMC closing documents. Consequently, discrepancy arises. «Later we started showing this difference to the customer and offered him to choose whether to make the payment according to the fixed arrears or the real ones», Mr Safonov says. «We call this a „treasurer — accountant“ dilemma: a treasurer is willing to pay less and later, and an accountant needs to have all the numbers added up correctly».

The procedure of removing all possible discrepancies in closing documents provided by the agency and in the statement provided by American Express Bank does not imply extra costs for the company, but makes accounting slightly more complicated. It was proved by experience by ABB that switched to BTA American Express in June 2014 in order to optimize the processes of travel expense management.

When a TMC works with such large customers like ABB, the recourse to banks that provide credit solutions is inevitable. Travel agencies do not have such an amount of borrowed funds that would allow it to make its own payments for booked airline tickets to the air carrier every 10 days, according to BSP (Billing and Settlement Plan) adopted by IATA. It is not possible to issue invoices every 10 days either, because large companies have a complicated and long reconciliation procedure.

«The optimal way out in this situation is the recourse to banks that are ready to provide this credit, and American Express Bank, in particular, offers it for 28-58 days», general director of the Russian representative office of HRG Philip Lookianenko says.

Indirect Procurement Manager of ABB Aleksander Kotov stressed some other advantages of using BTA by companies, apart from the positive effect of payment by installments. They include improvements in report quality and KPI in observing payment dates. «When we did not work with the BTA scheme, our payments sometimes were late because of the complicated reconciliation process. Now there is no such a problem due to optimization of data transfer process and extended prolongation that is never offered to agencies», the speaker stressed.

The topics of the educational session were so interesting for the participants that discussions continued even outside the conference hall — in an informal atmosphere during the coffee break and lunch. The session was useful both for the representatives of companies that had not yet adopted the advanced data processing and transmission technologies and did not use lodge cards, and for companies that were already working with them.

«I think that the name „educational session“ has been fully justified in this case», administrative director of the chain of hypermarkets of household appliances and electronics Media-Markt-Saturn Inna Alshevskaya says. «Things that we have learned today can not be learned anywhere else, no trainings include information on novelties discussed here, colleagues share information about what is up-to-the-minute and currently important, as well as their experience that we can draw conclusions from. Our company will contemplate the solutions that were discussed here».

Sales director of HRS.com in Russia and the CIS Aleksandra Naumova said that most of their corporate customers used AirPlus payment systems, but unfortunately this global provider was not present in the Russian market, so lodge cards by American Express Bank or Visa were an important topic for discussion.

At the same time the participants stressed the practical value of all the educational sessions. Thus, marketing and advertisement expert of ART-TOUR DMC Ratmir Romanov stressed: «The necessity of sessions held by ABT-ACTE Russia is explained by our reality — MICE segment in Russia is on the rise, and you need to refresh your knowledge and contacts again and again, introduce advanced technological solutions. Besides, topics of educational sessions are always well chosen: they meet the demand of business travel both in Russia and abroad».

Besides, there were pleasant surprises for the guests of the educational session. Partners of the event raffled off certificates for various services. Two session participants will be offered a transfer by Accord in any place of the world, another two will have breakfast in the Metropol (each voucher is for two persons). «Planet Sochi» Tourism Union will offer an opportunity to spend a remarkable weekend in the Black Sea Riviera and to stay in Hyatt Regency Sochi — the certificate for a stay at this hotel for 3 days and 2 nights was the main prize. Besides, after lunch the participants were offered an excursion around the halls and the rooms of the Metropol, where history is literally behind every door, and there are as many pieces of art in it as in a museum.

Natalia Travova