Credit unions in Australia should consider procure-to-pay services (P2P) even when they plan to emulate major banks, which plan to increase mortgage rates to cover more expensive bank funding costs.
Analysts believe that even if major banks indeed pass on the costs to consumers, margin pressures will still be a problem for them. As such, credit unions and the mutual banking sector are likely to experience the same despite raising their own rates.
Businesses need an efficient process of acquiring the necessary resources for providing a service, which normally entails different stages from planning to payment. Depending on the size of a credit union, this can mean multiple approvals from different departments, which consume time and effort. Many organisations have resorted to a third-party P2P provider to manage the costs of data processing and other expenses related to procurement.
By doing so, credit unions can focus on their primary tasks. Your workers would devote more time to customer service and marketing campaigns. Saved time means lower operational costs, which is among the primary benefits of using procure-to-pay services.
Choosing a Provider
When choosing a P2P provider, it is important to find out how they plan to meet your expectations. As digitalisation is a trend today, ask whether they can streamline the procurement process for you by doing it online. You should likewise ask how their standards meet ISO certifications and other industry standards.
Whilst online processes make procurement more convenient, cybersecurity has become more important. It involves making sure your P2P provider prevents any unauthorised purchases without approval from the board and other internal departments.
Some ways to improve your profit margin do not need to involve increasing rates to cover higher expenses. Instead, a cost-efficient procurement process would sometimes be a better choice to improve operational efficiency without hurting your bottom-line.