WHAT IS PAYOUT ORCHESTRATION?
The Complete Guide
to Payout Orchestration
How Better Payout Orchestration
Helps Your Business.
In this comprehensive guide, we will discuss the most important things to know about payout orchestration as well as eight of the most important things to consider when your company is redeveloping its payout systems.
One of the most important components of running a business is ensuring that all vendors, contractors, employees, and other relevant parties are paid in full and paid on time.
Not only will this ensure positive relationships with these parties—who are essential to the growth of your business—but it will also help you establish an immediate competitive edge.
This is especially true for global companies, who likely need to make payments in a variety of different currencies. Better payout orchestration also provides exceptional advantages to e-commerce businesses and other digital enterprises.
In this guide, we will discuss the most important things to know about payout orchestration, what payout orchestration actually is, and eight of the most important things to consider when redeveloping your payout systems. By taking the time to learn about the payout system, and find payout options that work well for you, your company can immediately improve its performance and deliver better results.
What is payout orchestration?
Let’s start by defining what payout orchestration actually is.
Payout orchestration is the process of automating and streamlining the payment of funds to multiple recipients. By using payout orchestration, businesses can implement and send cross-border payouts while also reducing the risk of errors and fraud.
Payout orchestration has proven itself to be exceptionally important over the past decade, with many businesses pursuing increasingly digital and global distribution systems.
Who Uses Payout Orchestration
Suppose you run an eCommerce business that works with vendors and contractors in multiple different countries. You have a project manager who is based in Colombia, a content writer who is based in the United States, as well as physical vendors based in the European Union.
Each of these essential partners needs to be paid in a different currency (let’s say one actually prefers to be paid via alternative payment methods, like crypto).
Also, each of these essential partners live in countries with different regulations. Furthermore, whether as a result of personal preferences or structural differences, each of your partners also uses a different platform for receiving and issuing payments.
As time goes on, the network of partners your business is connected to continues to become more complex.
Is your business in a position where it can easily make these payments? Is it also in a position where it could easily scale or adjust as needed?
Whether you answered yes or no, you should consider developing your organization’s payout infrastructure to match your needs. And creating an advantageous system requires a proactive, deliberate approach.
Fortunately, there are a lot of great resources available for making payouts, such as MassPay, which is widely recognized as the world’s most extensive payout network.
With MassPay, users can quickly develop a customizable payout solution and begin making payouts in a variety of different currencies around the world.
Why does payout orchestration matter?
At first, especially for newer businesses, orchestrating payouts might not seem like a very big deal. After all, there are plenty of businesses—even seven-figure plus businesses—that are able to simply make periodic PayPal payments to their contractors and vendors, who are generally cooperative.
However, failing to streamline your payout systems can have detrimental effects on your business. Ignoring the available, advanced solutions can cause companies to fall behind competitors. Here are just a few of the reasons why committing to better payout orchestration is so fundamentally important.
Without payout orchestration, businesses will often spend considerably more than they need. As time goes on, the cumulative costs of payment fees, opportunity costs, payment delays, currency conversions, taxes, remittances, and other expenses can begin to add up. Though not all of these costs can be avoided, payout orchestration can help cause them to considerably decrease.
Businesses that lack adequate payout infrastructure will almost always find themselves spending heaps of time tediously navigating multiple platforms, converting currencies, and making unnecessary manual data entries.
For most business owners, that’s time being spent away from the revenue-generating portions of their business. Why spend your time sending out money, instead of bringing it in?
The more complex your payout network becomes, the more prone to errors it will be. And in the world of payouts, making errors can have a variety of negative consequences, ranging from damaged relationships with vendors to legal and financial consequences.
Unfortunately, fraud, identity theft, and other issues are rampant in our increasingly digital world. But there are many things businesses can do to minimize their exposure to risk, such as investing in a payout system with built-in and thoroughly tested fraud prevention measures.
One of the challenges faced by businesses operating on a global scale is the ever-changing regulatory framework faced by their partners. New laws, new standards, and even changes in currency (for example, Croatia switched to the Euro at the beginning of 2022) demand a payout network that can easily adjust to changes.
All vendors, contractors, and other relevant parties share at least one thing in common: they want to get paid in full and they want to get paid on time. By orchestrating all payments onto a single integrated platform, such as MassPay, business owners can maintain positive relationships with everyone in their payment network.
Ultimately, it’s easy to see how orchestrating payouts isn’t just a “minor logistical detail.” It’s one of the most important components of running a business and is something that, frankly, no business should willingly overlook. After all, when all else is equal, businesses that have access to better payment infrastructure will be in a position to pull ahead of those that don’t.
EIGHT Things to Look for When Considering Payout Orchestration
Clearly, payout orchestration is an essential component of the broader business cycle. As long as making payments is something that is necessary—which it seems it always will be—then orchestrating those payments will be necessary, as well.
Even once your business has decided it wants to restructure its payout system, there are still a lot of things that will need to be considered.
Here’s what MassPay can deliver across your business.
1/ Global Payouts, Local Preferences
One of the most important considerations is the payment methods that will be used. You will need to decide which payment methods are most suitable for your recipients, such as ACH, wire transfers, or digital currencies.
Make sure to research the different options available and choose the ones that best fit your needs. You’ll also want to keep in mind the types of currencies your enterprise will likely be using. Currently, we work in more than 175 countries and 70+ currencies around the world.
Ideally, your business will use a platform that allows you to make payments in several different ways. After all, your payees will likely each want to be paid in different ways and in some cases, certain types of payments might not be available to them.
Using a dynamic platform with many different payout methods available—like MassPay—will help make it easier to make distributions and also incorporate new partners in the future.
2/ Intelligent Global Routing
When you’re sending money all over the world, you want to make sure it arrives on time, to the right person, and in the right currency. You’ll also want to make sure your money gets delivered safely with every transaction.
Our advanced algorithms route transactions to their destinations with backup options. Payment issues or inconsistencies can create big headaches for your payout team. So partnering with an organization that promises intelligent global routing, like MassPay, is essential.
3/ A Single, Simple KYB Process
A big hurdle to changing payout platforms is the setup process. Nobody wants to take time out of their busy schedule to set up programs and platforms and recipients.
That’s why we’ve developed an automated, one-time Know Your Business (KYB) tool to help you stay on top of your financial data and improve your security.
Within our software, you can validate any users and have global sanction screenings conducted on your payees every month. Compliance and regulatory standards are always up to date, and we pride ourselves on the safe storage and management of information.
With your financial data safe and available, you can focus on what will move your business forward.
4/ Transparent Pricing
When choosing a payout orchestration system, you’ll need to know all about the pricing and fees. Are you charged per transaction? Or are you charged a recurring license fee? Perhaps you’re paying for both.
With MassPay, we pride ourselves on our transparent pricing. Our pricing is simple, clear, and easy to understand with no hidden fees. We don’t think there should be any confusion or complications when it comes to paying us, so we can help you pay out.
5/ A Proven, Established Global Partner Network
Yet another important thing to consider when developing a payout orchestration network is scalability. After all, when your business jumps from being a six-figure business to a seven-figure business to an eight-figure business, you’re not going to want to have to keep “reinventing the wheel.”
As your business grows, you will need to scale your payout orchestration solution accordingly. Make sure to choose a solution that can easily scale your business and handle an increasing number of payments.
In this sense, the term “scalability” has multiple meanings. Not only should your business be able to handle a larger volume of payouts—which, as experienced enterprises will tell you, can increase tenfold in a very short amount of time—but also handle a wider variety of payments. For many business owners, scalability means (eventually) accessing new partners in other countries. Again, it becomes easy to see why having access to payout systems with many different currencies is so fundamentally important.
6/ Comprehensive, Real-Time Reporting
Over the past decade or so, the use of data has become more important than ever. Having access to reliable, up-to-date, and accurate financial data is an absolute must for all business owners. After all, if your business operates at the scale of $10 million, that means just a 1% improvement will result in an additional $100,000 on your bottom line—that’s certainly nothing to sneeze at.
As a result, reporting has become an important aspect of payout orchestration. Make sure that your solution provides detailed and accurate reports, so you can easily track the status of your payments and make adjustments as needed.
If you’re comparing multiple different payout orchestration systems, be sure to get to know their API to confirm that you’ll have access to the data you need. This could include reports regarding whether payouts have been, reports regarding your overall performance (for example, what percent of payouts have issues), reports regarding average payout time, and more.
7/ A Single API for Integration & White Label Capabilities
When you begin investing in a payout orchestration platform, it’s very unlikely your company is starting from complete scratch—that means you’ll need to integrate your new payout system with whatever infrastructure you already have in place.
MassPay’s REST API is not only incredibly simple to integrate, but it comes with the full support and customization you need to really make it yours.
We know that integrating a new system into your ecosystem needs to look the part. So our comprehensive white-label program helps you achieve just that. From look and feel to how it performs, our API can be completely customized to deliver whatever your business needs and what it doesn’t.
8/ 24x7x365 Support
Customer support is also an important consideration. For instance:
- What if you suddenly discover that, for whatever reason, your payments are not being processed?
- What if your business experiences a major structural change (such as M&A) and you realize you will need to quickly reinvent your payout system altogether?
- What if your business is preparing to enter a new market with extremely strict regulations?
- What if you have questions about the platform and want to make sure you’re getting as much value as you possibly can?
The MassPay support team is available at all times to help with any questions, concerns, or inquiries. We know that your organization requires support, and that’s why we don’t utilize phone trees or any automated support methods.
TIME TO TRANSFORM YOUR PAYOUT OPERATIONS
There is no denying that one of the most important components of running a business is ensuring your payments are always made on time.
This will always be true for everyone in your ecosystem including your employees, contractors, freelancers, partners, suppliers - everyone!
By taking the time to learn more about payout orchestration and develop a customized solution that meets your needs, your business will be in a position where it can grow, thrive, and achieve its long-term goals.