David Frogel, FastPay Chief Strategy Officer, recently joined PayPod host, Scott Hawksworth, to discuss the world of media payments and its impact on the overall media ecosystem today. With topics ranging from cryptocurrency in payments to the future of payments within the next 12-24 months, nothing is off-limits in this podcast by Soar Payments.
The current state of the union is no surprise to many agencies and suppliers as delayed payments have been a source of friction for years, but as Frogel points out, it’s only getting worse with time. In a competitive landscape where some of the largest advertisers are paying net 120-150, suppliers are left wondering why they’re getting paid so late.
“I spent my career working with entrepreneurs and as an entrepreneur in tech and media companies. I was the CFO of a media buying agency for about 7 years and witnessed a lot of friction between agencies and suppliers,” said Frogel. “Delayed payments and long aging on the books of media suppliers have been pain points for years, but that problem has really escalated in the last couple of years. The supply chain is feeling real pressure.”
What is the underlying cause of payment delays? According to Frogel, delays can be attributed to lengthening payment terms between advertisers and agencies, process friction having to deal with reconciliation in media, and the lack of motivation for agencies to pay faster. Adding further tension, all political ad buys have to be prepaid in order for an ad to run as scheduled.
“Payment speed is critical because every day you need cash to run your business, especially when it’s already taken months to get paid, counts. So for years, we’ve focused on making it easier for agencies to make the payments. Slow payments have now reached a fever pitch so what we’ve done is brought on new tools and a new solution that gets suppliers paid on fixed terms like net 60 without using a traditional credit or factoring facility.”
Equally as important as speed when sending payments, security and privacy are also vital, especially when handling millions of dollars in electronic payments. FastPay has heavily invested in identity management and security infrastructure over the years to ensure complete protection for clients’ most vulnerable data. “To this day, we’ve never seen any chargebacks or fraud on the cards that we’ve been responsible for and it’s been ten years now. I can’t say that will never happen but there are so many protocols built into the payments and lockdowns that prevent fraud from occurring.”
Whether it’s payment speed or data security, FastPay continues to meet the needs of an ever-evolving media industry. It’s an exciting time for the payments world as fintech continues to innovate and solve some major pain points. Make sure to keep an eye out for upcoming updates and progress along the way!
Check out the entire podcast below.