Basware and Mastercard- another new supply chain finance and payments option

It’s all going off in the payments, e-invoicing and supply chain finance world!

We’ve had the OB10 / Tungsten announcement, rapidly followed by Tradeshift and their link with CapitalAid to provide supply chain finance, then the MasterCard / Basware link up. We’ve also seen the emergence of Crossflow Payments – and more on that to come shortly, following a very interesting chat I had this week with their founder, Tony Duggan.

But let’s go back to MasterCard / Basware, as we didn’t give that much coverage when it happened.  Here’s an extract from the press release.

“MasterCard and Basware will  … [provide] a single global payment solution to guarantee that suppliers receive payment fast upon invoice approval, while lengthening payment terms for buyers. The e-payment service is enabled by the Basware Commerce Network, which is connected to the MasterCard global payment network and leverages MasterCard’s unique suite of payments products.”

“Basware’s Commerce Network already processes over 50 million invoices annually, totaling more than US$420 billion across 900,000 trading partners in 100 countries. This scope and reach is combined with MasterCard’s international payment network covering over 150 currencies across more than 210 countries and 20,000 financial institutions.”

We sometimes forget how big the Basware network is - $420B processed is pretty impressive by anyone’s standards, and not far short of the $460B Ariba claim (from their website).

So, back to the new arrangement. We will get a payment engine integrated into the end-to-end Basware purchase to pay platform, offering options to suppliers in terms of payment acceleration via the MasterCard network. All sounds good – and my US colleagues, who had a briefing from Basware the other day, were impressed.

“ (The press release)… did not begin to do justice to what is really happening behind the scenes of the two partners in terms of their overall vision for the relationship, the exceptional nature of the solution fit, product integration and planning, and joint go-to-market strategy, in addition to the serious due diligence it appears MasterCard did with Basware before entering into the partnership.

Indeed, Spend Matters US has an excellent and detailed review of the new partnership, so I’d thoroughly recommend you read that here.  At first sight, it’s hard to find too many weaknesses in the plans, and the investment community gave it a cautious welcome, marking Basware shares up around 10% - although that only takes them back to where they were a year ago.  However, with this and the BravoSolution partnership in place, Basware are well positioned to give SAP / Ariba and others a real run for their money in competitive terms.

 Of course, having a strong strategy is one thing – the ability to execute is another.  We’ll only be able to judge the impact of the two Basware partnerships in around 12 months time, when we can see how much real difference they've made to the firm’s performance.

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