Payments

By centralizing company-wide payment transactions, you can reduce the risk of fraud, increase transparency across banks and financial institutions, and automate workflows.

SAP
PAYMENT FACTORY

SAP Advanced
Payment Management

SAP
IN-HOUSE-CASH

SAP
IN-HOUSE-BANKING

SAP BANK COMMUNICATION MANAGEMENT

SAP MULTI BANK CONNECTIVITY

SAPPAYMENT FACTORY

The SAP Advanced Payment Management, SAP Multi-Bank Connectivity, and SAP Cash Management modules complete the integrated and efficient end-to-end payment process. All of your company’s payment transactions are bundled in SAP In-House Bank and SAP Payment Factory.

With SAP Advanced Payment Management, SAP offers an attractive finance solution for SAP S/4HANA and provides the basis for an economical and risk-free payment platform. All payment transactions are controlled by SAP Advanced Payment Management, which means: receipt, conversion, and forwarding of payment transactions in different formats. These formats are standardized by a single input channel and forwarded to the corresponding SAP modules for processing.

BENEFITS FOR YOUR COMPANY:

Security through centralization: absolute transparency across all cash flows
A cost-optimized, streamlined payment process that offers high transparency and flexibility
An integrated in-house banking solution coupled with transparent and versatile reporting and monitoring
Minimization of operational risk with support for enhanced tracking and complex security checks
The integrated in-house banking solution supports you with "intercompany payments," "payments on behalf of," and "centrally incoming payments"
Automated enrichment and validation of all payments
Communication between the in-house bank and the payment factory is improved

SAP Advanced Payment Management

In this context, SAP S/4HANA Finance for Advanced Payment Management enables cross-system centralization of payment processes within a group of companies and the establishment of a so-called payment factory. This solution was first offered by SAP with SAP S/4HANA 1809. SAP APM provides the following functions:

Import and further processing of payment carriers from SAP and non-SAP upstream systems
Central maintenance and harmonization of payment medium formats
On-behalf-of payments
Checking and enriching data
Encryption (e.g., of the HCM salary file)
Exception handling and error processing

As shown in the graphic below, Advanced Payment Management can be used with the approval process in SAP Bank Communication Management to release payments. However, non-SAP software products can also be used for release and transfer to banks.

Figure: Approval process in SAP Bank Communication Management for Advanced Payment Management

The Advanced Payment Management module offers additional interfaces to other areas of SAP S/4HANA, such as Bank Account Management, Accounting, In-House Cash, and Cash Management.

Figure: SAP S/4HANA Finance for Advanced Payment Management is the current SAP product in the area of payment.

Do you have any questions? We’re here to help!

MAURUS JEITLER

Founder and Managing Director

PATRICK WOHLSCHLÄGER

Founder and Managing Director

SAP IN-HOUSE-CASH

FUNCTION:

SAP In-House Cash is a SAP software module that enables companies to centrally manage their internal financial transactions. It reduces transaction costs, optimizes liquidity availability, and improves the control and transparency of internal financial flows. SAP In-House Cash supports multinational corporations in harmonizing their financial processes and making them more efficient.

The module enables the processing of a group’s internal payment transactions and is the ideal solution for companies with subsidiaries and branched cash pooling structures.

BENEFITS FOR YOUR COMPANY:

Optimization of internal transaction volumes
Improved access to liquidity
Reduction of internal payments and more efficient processing of remaining transactions.
Savings on transaction costs
Control and transparency
Fully automated account statement clearing of all intercompany transactions processed via SAP IHC

SAP IN-HOUSE-BANKING

SAP In-House Banking is part of the Extended Payment Management license for SAP S/4HANA Cloud and SAP S/4HANA On-Premise. This function is embedded in the Extended Payment Management module and enables you to make intercompany payment processes more efficient.

In-House Banking enables you to create an intercompany bank and optimize internal payment flows. In this process, subsidiaries or departments that are part of the group or company can open or manage internal bank accounts.

The figure illustrates how the in-house banking and extended payment management processes interact in SAP.

Figure: Integration of In-House Banking in the Advanced Payment Management module

SCOPE OF FUNCTIONS

Account management

Internal in-house bank accounts can be managed by opening, changing, or closing them. An approval workflow for a multi-eye approval process is possible. New accounts can be opened using templates. The upload function allows multiple accounts to be opened with a single click using an Excel spreadsheet.

Terms

The conditions are important for the account closing process and are defined in a separate app. An account can be part of a group and have a specific condition within the same period. The specific use is guaranteed by the system. In accordance with the predefined rules for the conditions, the check is carried out from the individual level to the group level to the bank circle level.

Limit settings

A limit can be set for accounts or groups using a separate app. An individual limit is only valid for the dedicated account, and a group has several accounts that together have a total limit.

Closing

Account closing is a continuous process that takes place as part of end-of-day processing. You specify the frequency and the key date for the closing run. The periodic job is performed daily and considers all accounts for which the key dates have been reached, and the accounts are closed. The closing report uses the defined conditions to calculate the interest. To generate detailed information, you can select a closing or interest scale notification in the front end of account management. The detailed information is provided as a PDF file and sent to the defined recipients by email.

Account statement

The internal account statement is transmitted to the subsidiaries as XML or PDF. The latest formats CAMT.053 or CAMT.054 can be created and imported into SAP account statement processing and posted.

Notifications

Three types of PDF messages are available in In-House Banking. The first two are the balance notification and the interest rate notification. These notifications contain details on the closing of an account and can be retrieved after an account has been closed. The third notification is the account statement message, which can be generated as a PDF file for the recipient.

Workflow

It is possible to define a dual control workflow for account management, limits, and conditions. Responsibility management can be used to define groups that are responsible for approving a workflow item.

Monitoring and overview

Separate apps are available for monitoring payments and displaying account balances. All important information is visible at a glance. Drilldowns to all payment items are possible, and navigation to the Advanced Payment Management app is included in the In-House Banking apps.

End-of-day processing

In In-House Banking, end-of-day processing must be performed to close the internal bank accounts. The end-of-day processing involves transferring the postings to the general ledger and sending the internal account statements and notifications of limits and interest rates to the affiliated companies.

ADVANTAGES

Centralized cash management: a central platform for managing cash and monitoring cash flows
Cost reduction: consolidating accounts enables costs to be reduced
Fast payment processing: facilitates payment processing and reduces dependence on external banks
Risk management: reduces currency and market risks associated with external banking relationships
Greater compliance: centralized control facilitates the enforcement of internal financial policies
Real-time reporting and analysis: real-time reporting and analysis functions for accurate and up-to-date financial information

SAP BANK COMMUNICATION MANAGEMENT

SAP Bank Communication Management allows you to track the entire lifecycle of a payment run. Payments are checked in the payment monitor, which monitors the status of each payment. SAP Bank Communication Management also offers you the option of approving payments and creating digital signatures based on an approval workflow using the FIORI app.

THE FOLLOWING FUNCTIONS ARE COVERED BY SAP BCM:

Grouping of payments based on definable criteria
Flexible payment release process and approvals with digital signatures and subsequent reporting, including status history
Option to reject individual payments and attach a note
Payment status monitor (including processing of payment status through incoming status messages, overview of payment folders, and review of current payment status)
Mapping of the entire life cycle of a payment flow, from payment approval to monitoring of correct execution in the account statement
Drill-down to the individual payment up to the accounting document

Figure: Bank Communication Management & Banking Communication Functionalities

Illustration: Exemplary process of the entire lifecycle – from payment run processing to approval

SAP MULTI BANK CONNECTIVITY

SAP Multi Bank Connectivity allows you to connect your SAP system to banks and institutions for payment transactions. The advantage is that this cloud product is hosted and maintained by SAP. You can communicate with banks via SWIFT, EBICS, and H2H channels and receive or send all common payment data carriers.

The SAP Multi-Bank Connectivity service automatically updates the payment status and financial status in SAP Cash Management. As a result, this real-time updating of cash flows also leads to process improvements in the company’s treasury operations.