One of the biggest challenges in treasury management in the Colombian business sector is to optimize their payment processes through interbank transfers, both in the generation and loading of payments, as in the conciliation processes, which usually have processing time restrictions and failures in the delivery of information. IRIS Neofinanciera, takes these difficulties and frictions of the payment ecosystem in Colombia, and takes advantage of its speed and digital adoption by extending its payment processing times.
(Iris Neofinanciera is revolutionizing the world of entrepreneurs).
For ACH Colombia, these blocks of bank transfers are processed in four cycles between 8:30 am and 3:00 pm, and during these periods the entities exchange the information received to digitally adjust the amounts in their accounts. Transactions received after the fourth cycle processing window closes at 3:00 pm are processed until the next business day in the first clearing cycle. IRIS Neofinanciera, with the objective of simplifying the lives of its clients, has a fifth cycle available at no additional cost, taking the closing hours for the management of its clients’ treasury from 3:00 pm to 5:00 pm. With this benefit, IRIS allows its clients that the money transferred to their suppliers, clients or collaborators arrive the same day, regardless of the destination financial entity linked to ACH Colombia.
(Banks in Colombia will have immediate transfers in 2023: ACH).
“Our clients, at the treasury level, need more time to process their payments and a stable, secure and easy-to-use transactional portal. With this in mind, we were able to extend our processing window for interbank payments. Usually, in the traditional system, customers can make their payments until 3:00 pm, and after this time the payments are received by the financial entity, with the proviso that they are processed until the next business day. At IRIS Neofinanciera we were able to extend the time until 5:00 pm so that the money is paid to the recipient of the interbank transfer the same day, without effort and additional costs”, says Lorenzo Garavito, CEO of IRIS.
How do the cycles work?
The country’s banks and financial entities are associated with the ACH Colombia Clearing House, to allow both individual and massive interbank transfers (batch files). When a person or company makes a transfer to an account in another entity, the originating financial institution identifies, among other information, the receiving account and the amount accumulates it along with other transactions to generate an ACH processing block. The blocks are processed in four cycles between 8:30 am and 3:00 pm, and during these periods the entities exchange the information received to digitally adjust the amounts in their accounts. Transactions received after the fourth cycle processing window closes at 3:00 pm are processed until the next business day in the first clearing cycle.
This is how the fifth cycle becomes a key efficiency tool; which operates at the end of the day, and is usually used in return and compensation operations for other products. “Having this benefit available is a milestone both for us and for the Colombian financial sector, it was efficient and agile work. We combined experience and technology from different areas of the company to make the fifth cycle a reality in a few weeks. We extend until 5:00 pm, two additional hours that allow a treasurer more time to organize the information, facilitate their tasks and simplify their work. Fifth cycle is today a benefit that we deliver to our customers at no additional cost”says Garavito.
This is how IRIS Neofinanciera, leveraged on its digital solutions, enables the fifth cycle for the processing of its interbank transactions, in this way its clients generate all their transfers through the digital portal until 5:00 p.m. In this way, a supplier payment, for example, can be generated on a Friday afternoon (payment day) and allow the money to be reflected in the destination account of its supplier at the end of the day, regardless of its bank.
As well as the advantage of having more time, it has no additional cost for IRIS clients, and also does not require a minimum transaction amount.. “This benefit gives our clients time benefits, both for carrying out their operations and for their operational processes, thus allowing them to focus on strategic issues. In addition to cost savings, because it is a benefit without additional charge”, assures Garavito.
So, given that the system allows payments to be generated until the last moment of the day, it also minimizes transaction difficulties at the treasury and administration level, thus allowing customers to reduce possible fines for late payment, or take advantage of early payment benefits more easily.
“This technological innovation is added to our latest launches such as IrisPay, and the IrisCard prepaid card, solutions that facilitate the administration of all financial processes for our clients.”, concludes Garavito.