VeriFone, Inc and Ariba Technologies announced yesterday plans to integrate VeriFone’s vPOS merchant Internet payment software with Ariba ORMS.
With business-to-business transactions outnumbering those between businesses and consumers, the combined VeriFone and Ariba solution represents a major step in enabling widespread secure electronic network payment among businesses over the Internet.
The Ariba ORM solution uses corporate Intranets and the Internet to automate the entire process of acquiring operating resources, from requisition creation, through approval, payment, and receiving. By integrating VeriFone’s vPOS Internet payment software based on the Secure Socket Layer (SSL) and SET Secure Electronic Transaction(TM) protocols to this process:
— purchasing organizations can make secure online payment easily, cost effectively and in an organized manner – significantly reducing accounts payable costs;
— suppliers can also dramatically reduce costs and payment cycles – significantly improving cash flow.
“Today, most business-to-business payment is accomplished through paper invoicing, purchase orders and checks — an expensive, tedious and labor-intensive process,” said Bobby Lent, vice president strategic alliances, Ariba Technologies, Inc. “Issuing a check may cost a purchasing organization as much as $65, and collection of a payment may cost the supplier as much as $35. Through online payment, this can be reduced to pennies for purchasing organizations and a few dollars for the supplier.”
In the ORM solution model, vPOS software resides with suppliers. Purchasing organizations pay the supplier using online purchase cards — credit cards designed to serve the business-to-business market. The suppliers with vPOS software receive payment through vGATE-enabled financial institutions. The vPOS product is the merchant component of VeriFone’s complete Internet payment solution based on SSL and SET, which also includes vGATE gateway software for financial institutions and vWALLET software for consumers.
“The Ariba ORM system using VeriFone vPOS creates an opportunity to use purchase cards to extend business-to-business on-line payment to corporations and suppliers that cannot cost-justify EDI,” said George Hoyem, vice president and general manager, Internet Commerce Division, VeriFone, Inc. “The purchasing card model provides smaller suppliers access to the considerable reporting and infrastructure support of the credit card industry.”
“The use of the Visa purchasing card can open on-line business-to-business payment to a much broader set of businesses,” said Thomas Proctor, vice president Electronic Commerce, Visa International. “Through the established credit card infrastructure, businesses of all sizes can take advantage of on-line payment. VeriFone’s delivery of vPOS to suppliers is a significant step in enabling this new means of business-to-business electronic commerce.”
Ariba ORMS combined with VeriFone’s vPOS software is designed to accelerate the use of business-to-business electronic systems by large and small suppliers alike. While 95 percent of the Fortune 1,000 companies are using electronic data interchange (EDI), according to Forrester Research, only 2 percent of the 6 million businesses in the U.S. use such technology. The low transaction costs and standardized communication protocols of Internet should encourage the adoption of business-to-business electronic commerce by even the smallest of businesses.
Operating Resources are items that support a company’s day-to-day operations, such as office supplies or capital equipment. They account for a third or more of the expenditures made by a typical Fortune 1000 company. More importantly, nearly 95 percent of all operating resources are acquired and managed using paper-based processes. According to Killen & Associates, a 5 percent savings in these purchasing costs will commonly result in a 28 percent increase in a company’s profits.
The integrated vPOS and ORM network payment solution will be discussed in detail as part of the ORM Supplier Summit, March 24 in Santa Clara, Calif. The Summit is co-sponsored by Ariba, VeriFone, Visa and Federal Express and is intended to help suppliers learn to support buying organizations in the ORM model. For more information regarding the ORM Supplier Summit call 1-800/355-5808.
Ariba Technologies, Inc. is the leader in Operating Resource Management (ORM) solutions for Global 2000 corporations. The company’s products deliver a high Return on Investment through reduced ORM transaction costs and improved management of the acquisition of the goods and services required to operate a company. The products leverage the Internet and Intranets to connect buyers to suppliers and thin-client network computing to make deployment to every desktop possible. The Ariba Internet address is .
VeriFone, Inc. (), a wholly owned subsidiary of Hewlett-Packard Company, is the leading global provider of secure electronic payment solutions for financial institutions, merchants and consumers. VeriFone has shipped more than six million electronic payment systems, which are used in over 100 countries.Details