Susheel: Thayer, thank you for taking the time out of your busy schedule to talk with us. DistilNFO appreciates it!
To start with, tell us about yourself, your career journey so far and your current role at PaymentWorks. What are the key traits that made you successful in your roles?
Thayer: Hi there – I’m the CEO and Co-Founder of PaymentWorks. We have a number of health system customers – Such as Hopkins Medicine, NYU Langone, RWJBarnabas – that use our software to manage the process of onboarding new vendors and updating vendor qualification information on an ongoing basis.
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I’ve been in the payments industry for 35 years and saw an opportunity that wasn’t being met. Most organizations – not just in Healthcare – rely on static “vendor forms” to collect information from third-parties. The process is cumbersome and manual – and exposes organizations to various types of risk. We thought that if we could automate the process – we could eliminate the risk to our customers.
Thayer: When health care organizations rely on static “vendor forms” to collect information from third-parties – it exposes them to risk. Where there is a manual process, there is plenty of room for mistakes.
The vendor set-up and maintenance process is fundamentally flawed because it relies on people making (largely uninformed) judgements- such as ‘do I change this vendor’s bank account based on this email request?’ Additionally, vendor relationships run through procurement, AP, risk, insurance, diversity and individual business units, with no clear owner at most organizations. Who ultimately is responsible for the verification of the vendor’s info?
PaymentWorks eliminates the blind spots by verifying all credentials- which we call “identity elements” that a vendor typically submits on a vendor form – most crucially, tax ID, and bank account ownership. We give our customers peace of mind that they are paying a fraudster and all the compliance documentation has been collected.
Susheel: Technology is impacting every aspect of Business Payments, what about PaymentWorks will have the greatest impact on the industry and why?
Thayer: Business payment fraud has become an enormous problem in the healthcare industry. According to the FBI, it’s the largest source of cybercrime in the US. We eliminate the risk of business payments fraud for our customers, full stop. As part of the vendor onboarding (and maintenance) process, we collect banking credentials. We verify the information – so if we give an account our stamp of approval, and it turns out it belongs to a fraudster, that is a PaymentWorks problem. We make it right financially. There isn’t another product or service you can use that completely transfers the risk of payment fraud.
Thayer: Everyone knows about KYC- Know Your Customer- but the executives we work with are flying blind when it comes to KYV- Know Your Vendor. From sanctions lists to confirming bank ownership, there are simply too many moving pieces for the finance staff to track. They say ‘be careful’ and hold their breath. Not one of these executives wants to be in the paper for having fallen victim to a payment fraud scam.
Thayer: PaymentWorks is payee driven- it is up to the vendor to submit their information through our app. Our customers’ staff members don’t need to chase down W9’s or other critical pieces of information. Once the vendor has submitted their “identity” information, the app verifies the submission through a combination of 3rd party tools, proprietary software, and manual processes. The platform vets everything for our customers’ staff- there is no need to run their own processes to confirm if the EIN is correct or who owns that bank account.
Thayer: Earlier this year – before COVID – our enablement team was on-site with a new customer. The director of AP started crying during the training. Weeping really. She took a minute to gather herself, then said “I’m just so relieved that we are doing this. I lose sleep at night worrying about getting it wrong.”
This is a true story. And while the tears of relief may have been a first for us, that feeling where our platform quells anxiety seems universal. Our customers no longer lose sleep- at least not about paying someone they should not.
Thayer: Fraudsters love a crisis of any kind, COVID is no different. The abrupt shift to remote work for AP staff members in all industries obviously exacerbated, and ultimately exposed, myriad weaknesses that fraudsters have wasted no time in exploiting. What’s been interesting to see is how many of these payments fraud scams are actually focused on social engineering rather than some sort of sophisticated hack. Just a simple email or phone call that convinces an AP person to pay the wrong account.
As a result, our business has seen a shift across several verticals where what we do is no longer in the ‘nice to have’ spending bucket. Avoiding payment fraud is now considered essential.
Thayer: Well, sadly, COVID has accelerated the various historical trends at play in our society and economy. One of them is the “digitization” of work and how we form business relationships. In the old days, vendors came to your office and you had a chance to get to know them personally. Now – more and more business relationships are being formed remotely (over zoom and other means). This makes it easier for malicious actors to take advantage of honest people – who aren’t as savvy as they should be about the various forms of fraud and social engineering scams that are taking place at an accelerated pace.