SAP NetWeaver, American Express Team Up on Automated Payments Module

American Express and SAP will collaborate on an integrated product that simplifies payments automation, the two companies said on Oct. 19.

The new offering will combine American Express’s Buyer Initiated Payments product with SAP’s PI (Process Integration) technology available on the SAP NetWeaver platform. The integration of American Express technology into SAP Netweaver will allow SAP customers to process electronic payments more seamlessly.

“With this joint effort, we will be able to offer SAP and American Express clients a faster and more cost effective way to recognize the benefits of electronic payments,” said Jaromir Divilek, senior vice president and general manager at American Express Global Commercial Card in a statement.

The joint American Express/SAP product will feature a “plug and play” utility for SAP customers to set up electronic payments quickly, the companies said. The PI technology maintains payment data integrity, workflows, and approval process that customers are already running on SAP.

This will be a joint effort, with teams from both companies working on the integration, said Molly Faust, vice-president of public relations and communications at American Express. The integrated Buyer Initiated Payments/PI software is expected to be available in the first quarter of 2011, but will be available to SAP customers in the United States only, said Faust.

As part of the agreement, American Express will also license the SAP NetWeaver PI technology, Faust said.

The companies hope to “clear roadblocks that can delay or deter corporate adoption of electronic payments,” according to the statement. Some potential roadblocks customers face are the deployment costs and the complexity behind connecting multiple third-party systems to handle the various steps to complete a financial transaction.

“Corporate clients typically have a fragmented base of treasury workstations, trading systems, accounts payable solutions, payroll processors, and other financial solutions that exchange data internally and externally with banks and corporate suppliers. More standardization of data and better connectivity between buyers and suppliers are needed,” said Jeanne Capachin, research vice president of IDC Financial Insights.

Companies can have multiple system interfaces between their own enterprise resource planning systems and the systems belonging to their banking partners and suppliers, often depending on custom development to link everything together. According to the statement, maintenance costs can be high, averaging anywhere from $50,000 to more than $500,000 for large global corporations.

“Automated payment solutions can be critical to companies seeking to save money, but have historically required significant investments in resources and time to implement,” Divilek said.

By integrating payments solutions with SAP’s existing ERP system, corporations can enhance controls, optimize the timing of their payments, and gain greater visibility over cash flow, the companies said. It will provide a single interface with improved financial connectivity to external suppliers, financial institutions, and other internal systems.

American Express’ Buyer Initiated Payments is a Web-based automation tool that handles electronic payments and supplier inquiries in a secure environment. SAP NetWeaver’s process integration facilitates data exchange between the system and third-party applications.