Have you ever wondered how difficult it can be to pay several recipients/contractors in a fast and assertive way? Now, imagine paying all of them simultaneously and considering that some contractors may be located in different countries, which makes things even more difficult. Thus, the best solution relies on mass payout (mass payments). Get ready to know what it means and how it can help businesses to overcome these challenges.
What are mass payouts?
Mass payouts, which is also known as mass payments, is basically a method that automates the process of paying a large number of recipients, or contractors, simultaneously and online. The payments are sent by a single sender and saves a lot of costs and time while allowing a company to relocate its resources to focus on its core business.
There are recurrent and one-time transactions, while the amount paid can vary or remain the same along the time. Hence, all these preferences can be set in the mass payout system, and the user can, for example, use an API (application programming interface) to upload a spreadsheet with all the necessary data to perform the payments.
Why and when does a business look for mass payouts?
Many businesses, such as e-commerces, need to pay their sellers when a shopper buys on their platforms. So, relying on manual entries can be very risky. Payments may be missed and reconciliation can go wrong if manual processes are in place. Besides being more prone to errors, it can be very time consuming.
Now, picture that: a large multinational e-commerce platform needs to pay several of its sellers online, in multiple currencies and different countries. Thus, in this case, a specific mass payout system must be implemented to attend its needs.
Remember that in some cases a service may have a great performance locally, but not for cross-border payouts. Each country has its own financial systems, regulations, laws, taxes, fees, etc. So, all of that turns cross-border mass payments more complicated, yet crucial for business success.
Mass payout advantages
You may already have some clues of how important mass payments can be for a business. Of course, its importance may vary depending on the number of recipients and other variables, such as location, regulations, currencies, etc.
Nowadays, several smart platforms have emerged and these systems are being widely used in many areas of a company, such as payroll, batch processing, accounts payables and situations where a high payment frequency or large number of recipients are demanded. So, here are three main advantages that mass payouts truly provide:
- Higher efficiency: since it is an automated process, mass payouts are an assertive, faster, easier and more effective way to pay a large number of recipients simultaneously.
- Increased level of trust and security: because it is more assertive than manual processes, for example, mass payments strengthen the payer’s reputation and increase its trust among recipients and stakeholders in general.
- Less costs: mass payout is a cost-saving method. Why? Because in manual processes for example, when paying a recipient overseas, there are a lot of fees that will apply for each contractor in each country with a specific financial institution. These fees are related to FX, wire transfers, and all the paperwork involved in the process.
EBANX Payout solution offers a localized payout experience, in which brands can easily navigate the local challenges of settling internal funds to contractors in different countries and currencies, safely and quickly, while leveraging the expertise surrounding the Latin American market that only EBANX offers.