Three more technology vendors have agreed to incorporate an automated clearing house format developed by The Clearing House Payments Co. LLC for corporate payments into their software, and Union Bank of California is preparing to test it.
“We have been making significant progress” on the EPN STP 820 format, Rossana Salaris, the senior vice president at The Clearing House who runs its ACH unit, Electronic Payments Network, said in an interview Wednesday.
There are now seven software vendors using the format in their cash management and accounting software packages. The New York company announced partnerships last week with three of them: ACH Direct of Cathedral City, Calif., Coastal Software and Consulting Inc. of Vancouver, Wash., and Treasury Software Corp. of Weston, Fla.
Those vendors join Fundtech Ltd. of Jersey City, P&H Solutions Inc. of Newton, Mass., NexTec Group Inc. of Houston, and Fiserv Inc.’s Banklink business.
. Some of the vendors sell cash management software to banks, which then offer it to their corporate customers; others offer accounting software directly to businesses.
Though the software is available, nobody has actually sent an EPN 820 payment yet, Ms. Salaris said. Having both types of software available will make it easier for companies to start using EPN 820 payments, she said.
“Companies really want to move to electronic payments,” she said. “Our goal is to get mom-and-pop shops, the local gardener — all these people who are becoming more savvy about using online banking — to use electronic payments.”
The year-old format, a simpler version of the widely used electronic data interchange 820 (or EDI 820) payment format, is designed to make it easier for companies to send and receive electronic payments.
Glenn Fromer, the director of development at Treasury Solutions, said many companies want to use a single remittance to pay other companies for multiple invoices. Though many large companies do so today with the original EDI 820 format, “it is beyond the scope of most midsize businesses,” he said.
Treasury Solutions has created an EPN 820 module that works with its ACH Universal accounting software and lets businesses create their own ACH payment files. It has also added the format to its ACH2Excel software, which lets companies receive EPN 820 payments. The payments include details for many invoices, and a single payment amount.
Mr. Fromer said that the software is ready now but will not be released for a few weeks. One customer — a collection company that must send funds it has collected for many consumer accounts to Sprint Nextel Corp. — has already agreed to use the software.
Treasury Software is also talking to a collection company that works with Cingular Wireless LLC and may complete a similar deal in a few weeks, he said.
Ms. Salaris said it is important that there are products to support both sending and receiving payments. “Being able to send electronic payments is good, but if the receiver cannot accept it electronically, that’s only half the equation. Companies say they need it all to be electronic; otherwise it’s just a mess.”
Most of the companies that use EDI 820 are very large. It is typically run on mainframe systems, and few new systems have been installed in recent years. The technology has been around for years and is considered effective and stable, but a poor match for small and midsize companies that want to begin making payments electronically.
Standard EDI 820 files can contain hundreds of data fields. The EPN 820 version has just 10 fields.
Ms. Salaris said that Union Bank of California is preparing to test the format by using software from Fundtech to send a payment.
George Ravich, Fundtech’s chief marketing officer, said that the bank, a unit of UnionBanCal Corp. of San Francisco, which is mostly owned by Mitsubishi Tokyo Financial Group Inc., plans to send an EPN 820 payment to the Atlanta paper and building product company Georgia-Pacific Corp. in the next few weeks.
“We’re all really excited,” he said. “This is the real deal, because someone is really going to use” an EPN 820 file.
