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Writer's pictureKartik Dabbiru

Unblocking B2B Payments: The Urgent Need to Revolutionize RFI Processes

In the rapidly evolving landscape of B2B Payments and exponential volume growth of 5% CAGR projected to hit ~ $137 trillion by 2027, the demand for speed and efficiency is higher than ever.



While there have been advances in the Payments infrastructure such as Real Time Payments in the US, Instant Payments in the EU and Stablecoin rails, there hasn’t been much innovation in the Compliance based communication processes associated with B2B Payments.


One such process — the traditional Request for Information (RFI) process is a significant bottleneck to achieve frictionless payments.


The annual cost globally to review and process stopped payments is a whopping $55 Billion!


And as the volume of payments increases, there is a tendency for the # of RFIs to go up. This forces the Payment Service Providers (PSPs) and Banks to hire more Compliance Analysts to manage the higher volumes (the classic “throw more people at a problem” syndrome).


However, this approach is neither sustainable nor cost effective in the long term.


What is the traditional RFI process?


PSPs, Banks and other regulated Financial entities send out emails to their Customers to request additional information and documents about the Customer and/or the Payment in an event a Payment is stopped. This manual exchange over email is referred to as the RFI process.


Entities involved in the Payment chain have a Regulatory & Compliance obligation to prevent money generated from illicit activities or sanctioned countries/entities from entering the global financial system.


Such entities have to screen and monitor any inbound/outbound payments based on predefined typologies and trigger events associated with the AML/CFT/Fraud/Sanctions risk posed by processing a payment.


When there is a relatively high degree of suspicion, the payment is stopped. In most cases (~95–99%), the stopped payment is released or rejected without any contact with the Customer.


However, in 1-5% of cases, the Payer (party making the payment), the Payee (party receiving the payment, and intermediaries such as PSPs and Banks are sent an RFI via email seeking details about the Payer or Payee and the Payment including evidence of the details provided.


The RFI process turns out to be a very frustrating experience for everyone involved since the Payment is held, under investigation, for up to 4 weeks or longer.


Impact of RFIs on Businesses and Payment Providers


Revenue Leakage


Businesses especially in high-risk industries such as Gaming/Gambling/Crypto integrate with several PSPs to maintain consistent payment processing for their End Users/Customers. These Businesses keep switching payments between their PSPs to use the route of least possible resistance.


RFIs are a threat for PSPs as it forces the Customer to divert their payment flows to other PSPs in their arsenal owing to higher volumes of stopped payments and RFIs.


Reputational Damage


In this age where Customers expect Payments to be instant, having a Payment delayed even for a few hours can destroy the reputation of the PSP.


This is equivalent to the “top of card” effect where the Customer will not be so sure to use the PSP again based on their past unpleasant experience of stopped payments and associated RFIs.


Customer Loss


Continued frustration amongst Customers owing to this friction in Payments can also lead to the PSP losing customers. In a survey done by Lexis Nexis on 400 Payment execs, 50% of them reported losing 2% or more of Customers due to stopped Payments.


In conclusion, we firmly believe that this is a problem worth solving and the advent of automated, consistent, and faster RFIs could be the game-changer that the Payments industry needs.

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