1. Ontario Local Chapter Meeting Automate Invoice-to-Payment Cycle Unlock Your Working Capital

2. Agenda  Introduction  Overview of VersaPay  What Are Your Challenges?  The State of A/R Today  The 4 Universal P’s of A/R Automation  Trends  Opportunities and Approaches  Carving A Path Forward 2

3. Your Speakers Mislav Majic, Managing Director Solutions John McLeod Vice President Marketing Source: Crone Consulting LLC – The Next Wave In Payments

4. VersaPay Overview VersaPay is a financial technology company that delivers cloud- based payment solutions for businesses  Founded in 2006  Ranked #1 in Profit Top 50 in 2009  IPO on the TSXV January 2010 ; $26.M Mkt. Cap. Today  Two business units: POS Merchant Services & Solutions 1.POS is a profitable mature business 2.Solutions: cloud-based services to transact electronically  Strategic partnerships  TD Bank  Heartland Payment Systems  MasterCard

5. Pain Points What Are The Pain Points You Are Experiencing?  Days Sales Outstanding Too High?  Working Capital Challenges?  Volumes Customer Inquiries?  Matching payments to invoices too time intensive?  Greater Visibility Into Invoices?  PCI Compliance? 5

6. The State of A/R Today  Invoices are generated by ERP system  For large customers…  Invoice data is delivered electronically via EDI  For smaller customers…  Paper or PDF copies are mailed or emailed  The payment process is not visible to the supplier  Follow-up by email or phone  Payment received by check or EFT, wire and credit card  Payments are manually matched and entered into ERP

7. The State of A/R Today  Many manual steps  Error-prone and cumbersome  Time consuming In other words… "we do it the way we have always done it”

8. A/R Process:  Invoices are mailed, emailed, faxed or online  Follow-up by phone or email  Payments are customer generated  Check, EFT/ACH, wire and credit card  Manual reconciliation Suppli er ERP Syste m Customer ERP System

9. Ontario Local Chapter Meeting 4 Universal P’s of AR Automation

10. Presentment  Given the interactive power of the Internet … invoice data no longer needs to be static  Added value for Customers  Builds stickier relationship

11. 4 Universal P’s of AR Automation Permission  Establishing secure, authenticated access to the invoice information and payment options  Enable preferred payment instruments controlled by Supplier  Funding sources specified, verified and managed by authorized customer

12. 4 Universal P’s of AR Automation Linking Presentment and Payment:  Cost savings and electronic settlement  AR automation drives value by matching customer payments to invoices  Suppliers will reduce costs of  acceptance, dispute resolution, reconciliation and fees  AR Automation has to support all payment channels

13. 4 Universal P’s of AR Automation Posting:  Automated reconciliation  Minimizing manual, error prone processes  Reduce/eliminate expensive and error prone Lockbox process  Maximum cash management benefits by accelerating electronic payment acceptance

14. Why Now?  Trends Laying Groundwork for Change  Navigating Complexity – Finance Groups Streamlining processes will deliver exceptional value  CFO’s increasingly focused on business transformation to build value  Cloud computing can enhance finance function’s performance  Finance more involved in strategic initiatives like customer experience Accenture Report: Accenture 2014 High Performance Finance Study http://www.accenture.com/us-en/strategy/Pages/index.aspx

15. Why Now? 1 2012 Remittance Survey of 662 AR, treasury, AP, purchasing, procurement, and accounting professionals (n=662). 2 Suppliers’ Acceptance of Card Payments. First Annapolis Consulting. August 2013. of business respondents have moderate to high interest in using more electronic payments. 1 include card-related terms in contracts — more than 2X the number just 4 years ago. 2 of businesses include card-related terms in RFQs. 2 43% 50%92%

16. Ontario Local Chapter Meeting Primary Cost Reduction Opportunities

17.  Outbound and inbound processing  Outbound and inbound float  Automating customer care  Payment mix management Source: Crone Consulting LLC – The Next Wave In Payments

18. Primary Cost Reduction Opportunities Outbound processing  Invoice & statement production  Sorting/preparing/mailing/postage  Omni presentment requirements  Storage and accessibility Source: Crone Consulting LLC – The Next Wave In Payments

19. Primary Cost Reduction Opportunities Inbound processing  Receive & retrieve lockbox  Envelope extraction  Sort by payment type (full, multi, partial)  Process Exceptions  Balance Batch  Post to A/R  CPU A/R Update  Reporting  Clearing Costs  Bank Fees  Processor Fees  Payment Processing  Other Source: Crone Consulting LLC – The Next Wave In Payments

20. Realize A/R Process Efficiencies  Redirect A/R staff to Higher Value Work Accounts Receivable Performance Doing Ok is no longer good enough www.apqc.org  Automation supports greater productivity

21. Greatest Benefits of eInvoicing PayStream Advisors: 2014 Invoice & Workflow Automation Report http://www.paystreamadvisors.com/

22. Primary Cost Reduction Opportunities Outbound float  Mailing float and customer aging of receivable  5-40 day  Monthly batch processing for account update  1-5 days  Statement rendering & printing  1-5 days  Folding insertions, stuffing, metering, sorting  1-5 days Source: Crone Consulting LLC – The Next Wave In Payments

23. Primary Cost Reduction Opportunities Inbound float  Mailing float  1-5 days  Extraction, preparation & remittance processing float  1-3 days  Clearing float for deposited checks  1-5 days Source: Crone Consulting LLC – The Next Wave In Payments

24. Problems Leading to Late Payments PayStream Advisors: 2014 Invoice & Workflow Automation Report http://www.paystreamadvisors.com/

25. Primary Cost Reduction Opportunities Automating customer care  10% to 40% of business invoices disputed  Disputes slow down payments, increasing DSO  On-line disputes est. to be 50% less expensive  Collaboration ensures prompt dispute resolution/pay  Automated payment acceptance is simpler, faster Source: Crone Consulting LLC – The Next Wave In Payments

26. Improve Customer Interactions  Errors Corrected Faster Accounts Receivable Performance Doing Ok is no longer good enough www.apqc.org  A/R Teams Redirect Efforts  Reduce DSO  Improve Working Capital

27. Primary Cost Reduction Opportunities Payment management mix  Online payments versus offline  Currently costs $0.75 to process each “inbound” remittance  This included processing for cheques, customer initiated EFT/ACH, wires and credit cards  Bank fees can be quite costly  Auto pay is the lowest cost of acceptance  Intelligent credit card acceptance can be second lowest form of acceptance Source: Crone Consulting LLC – The Next Wave In Payments

28. Value PropositionSupplierBuyer Payment process improvement Automates payments/reduced collection efforts Eliminates cheques/postage costs/processing errors Cash Flow improvement Reduces DSO and improves working capital Potentially increases DPO/Float/Control Improved customer/supplier relationship Buyer payment of choice/preferred supplier Suppliers paid quicker/reduced collection costs Reduced risks Can lower bad debt ratios Online reporting with full audit trail Positive impact to balance sheet Less reliance on other credit facilities (loans, margins) Provides additional financial flexibility Source: Visa Intelligent credit card acceptance

29. Ontario Local Chapter Meeting Unlocking Working Capital

30.  Reduced float time = access your capital sooner  Optimize customer care = access your capital sooner  Reduce time to resolution = access your capital sooner  Make it easy to pay = access your capital sooner  Reduced bad debt = access your capital sooner  Reduced payment processing costs = access your capital sooner

31. SUPPLIERSBUYERS  Collaborative platform for B2B ecommerce  Easy integration  Accelerates payments  Eliminates manual effort  Reduces cost  Improves Customer Experience  Easy to use  Eliminates paper and manual processing  Choice of secure payment options  Provides complete audit trail Versapay ARC

32. Ontario Local Chapter Meeting Demo

33. Let’s move A/R forward  Delivering an end-to-end STP process for A/R is more feasible today than ever before  The problem may not be pressing, but the payback is compelling  There is customer demand for it  Leverage cloud-based tools and payment provider capabilities to get results quickly  VersaPay ARC can help

34. Ontario Local Chapter Meeting Questions?

35. Future Session Topics?  What other AR topics are you interested in?  Download this presentation at www.versapay.com/ifo

36. Ontario Local Chapter Meeting Thank You Mislav Majic mislav.majic@versapay.com