SINGAPORE--The solution, known as electronic invoice presentment and payment (EIPP) B2B, is an electronic invoice which allows companies to electronically bill and collect payments from trading partners. It also allows customers to view, dispute, approve and pay their invoices online.
"We want to basically take good advantage of the Internet," JP Morgan vice president of treasury services Joseph Stark said in an interview today. "We are trying to get more involved in a seller's (automation) process of taking invoices and providing services through until the cash is collected into its bank account."
He was speaking at the sidelines of EuroFinance's Cash and Treasury Management in the Asia Pacific Region here.
Stark said EIPP is targeted at large corporations and primarily JP Morgan customers in the oil and gas, chemicals, high technology and telecommunications sectors, e-marketplaces and exchanges. JP Morgan has "a few thousand customers" in Asia, he noted.
Stressing on the benefits for buyers and sellers, Stark claimed that with EIPP, companies can collect payments faster by reducing the number of steps in the collection process, trading partners are notified the day the invoices are presented and it also reduces paper-related expenses. He added that it takes about two to three months to implement the solution with the sellers and their trading partners.
When asked about cost savings, he cited industry estimates which showed that companies paid between US$5 and US$50 to produce an invoice. With the new solution, it would cost companies "a few dollars", he said, without revealing specifics.
On the payment aspect, Stark said buyers could initiate an online payment through various modes including debiting their existing bank accounts on a scheduled date, by GIRO, by checks and by funds transfers. JP Morgan sends debit payment instructions to the buyers' banks, he added.
To a question, he said JP Morgan charges companies for per invoice or per transaction, monthly maintenance, and a one-time set-up fee, which includes licensing and implementation. He did not elaborate. He also declined to reveal projected revenues from the new solution in the region.
Stark said JP Morgan was in talks with "quite a few" customers in the oil and gas, chemicals, high technology and telecommunications sectors to use EIPP in Singapore. He did not provide further details.
He noted that Singapore, Hong Kong, Japan and Australia would spearhead the company's initiative to offer the new solution in the region. "On a gross domestic product (GDP) basis, these countries are the big players in Asia," Stark said. "Also, they are leading the charge in initiatives such as higher home personal computer penetration and higher demand from the corporate market place."
On how many customers it expects to use its new solution in Asia, Stark said he expected "the majority" of its customers to do so in a few years.
He declined to provide names of its competitors, except to say that "we are going to be much more aggressive and visionary in our product sales".
Stark also declined to reveal how much JP Morgan invested in EIPP, except to say that it has invested in manpower, hosting, and technology and database maintenance costs.