While the global coronavirus outbreak may be grounding corporate travel to a near standstill, leading travel companies and fintechs are continuing to hone AI-based payments platforms to reduce the problem of corporate travel fraud.
And with many companies suffering a loss of business due to the spread of COVID-19, they are even more mindful of how their budgets are being spent. For a long time, the corporate world has turned a blind eye to the odd employee fiddling their expenses. But when corporate travel picks up again, companies will likely be scrutinizing every receipt they receive.
Data collected by academics has shown that expense fraud is a bigger problem than many realize. When the University of Portsmouth’s Centre for Counter Fraud Studies surveyed corporate travel fraud two years ago, it found that one in ten U.K. employees admitted to having submitted erroneous expenses claims, with such activity costing U.K. businesses in the region of £2 billion every year.
However, many organizations believe that technology could make a significant difference. Last month, travel company TripActions launched its own corporate travel management and payments solution called TripActions Liquid. Companies that sign up to this platform are able to sync their corporate cards with online and mobile platforms which provide visibility into all transactions made on a business trip in real-time.
“It’s the first real-time reporting of all travel spend,” said Michael Sindicich, general manager of TripActions Liquid. “It also completely automates the reconciliation process. At the end of every month, finance teams typically spend hours or days matching up credit card statements with the purchases from different trips people have been on. Controlling that spend is nearly impossible for the company because they only get visibility into the transactions, a couple of weeks after they’ve happened.”
Streamlining corporate travel payments in this manner is developing into a niche but increasingly popular sector of the payments marketplace. Travelport also has a business travel payments platform available in partnership with U.K. fintech Conferma.
Conferma predicts that the use of such platforms can minimize fraudulent behaviour because they are more convenient for employees as well as companies, thus encouraging travelers to act more honestly. Paul Raymond, director of strategic relationships at Conferma, pointed out that many companies currently expect employees to pay for business expenses out of their own pocket before reimbursing them later, a process which often takes weeks.
The Federal Reserve chairman pledged to use every tool at the central bank's disposal to limit the economic fallout from the coronavirus and urged lawmakers to take further action.
Fiscal blow to MPEA's operations and tax collections follow the halt to trade and convention business that began in March.
The bureau issued an interpretive rule clarifying that consumers under certain conditions can modify or waive waiting periods required by the Truth in Lending Act and Real Estate Settlement Procedures Act.
“Relying on the ‘Bank of Employees’ impacts the perception an employee has of the business,” said Raymond.
As well as enabling companies to view an employee’s business trip transactions in real-time, such platforms are also incorporating artificial intelligence to enable company managers to set controls for how the card is used. For example, if a company opts to prevent the card being used at a liquor store, the inbuilt AI algorithms in the TripActions Liquid platform will automatically block that spending.
“It knows when an employee is on a work trip and can be configured to decline any transactions that are out-of-policy or outside of the dates and location of travel,” said Sindicich.
While now is a difficult time for any companies in the travel sector, such platforms do still appear to be of interest to the corporate world as they attempt to keep expenses to a minimum, with the prospect of a coronavirus-induced global recession around the corner.
Having launched a successful beta trial of its product over the past few months to 25 companies, TripActions is now reporting increasing demand within the corporate world.
“Everyone who touches accounting knows that travel payment reconciliation is an issue, but it was always one of those ‘necessary evils’ you had to deal with,” said Vik Shah, corporate controller at Zoom, one of the companies on the beta trial. “It’s been a major time saver, we’ve been able to reduce travel payment reconciliation time from weeks to minutes each month."