Taking the Pain Out of Expense Management

There are a variety of ways companies choose to manage their expenses – for example, senior executives may be given corporate cards, while other employees might use cash, pre-paid cards, or be expected to absorb costs upfront and submit their expenses later on. While each of these processes can be said to work, their level of efficiency and effectiveness is increasingly being called into question.

With many expense-management solutions currently in use, one problem is the lack of transparency and visibility, since the finance department cannot properly see expenses until they can been reviewed, approved and analysed. Without this visibility, it makes it harder for the finance department to spot anomalies in a timely fashion, and it impacts their ability to forecast and budget effectively. It also hinders their ability to identify opportunities to negotiate better rates with frequently used airlines, hotels and restaurants – all of which can ultimately impact a company’s bottom line.

Another problem is that most expense-management processes, in terms of review and approval, only occur after the fact. This means that although each company has its own policy for what can be expensed and what cannot, it pushes the responsibility for keeping within that policy onto its employees, which leads to the time-consuming process of submitting expenses and reviewing them in the first place.

With a greater awareness of these shortcomings, forward-looking companies are re-examining their travel and expenses process to reduce costs and increase the capabilities of their finance team.

Visa is helping develop these types of solutions by partnering with fintech companies, giving them access to Visa’s APIs (application programming interfaces) to create a more automated and user-friendly experience. “Employees want the same convenience that comes with consumer IT but in a business setting,” explains Stefanie Koh, Head of Enterprise Platforms and Solutions, Asia Pacific at Visa. “We are moving from desktop-first solutions to mobile-first. Expense management should be easy.”

It’s this philosophy of effectiveness and convenience that has inspired Fraedom, a New Zealand-based expense-management software vendor recently acquired by Visa. “Our goal is to take the pain and the paper out of the travel and expense-management process,” says Kyle Ferguson, Fraedom’s CEO. “For us, it’s all about the idea of a touchless transaction. Imagine a world where you tap your phone against a POS device and that's the last time you ever actually have to do anything with that transaction. That's where we are heading.”