Welcome to the series, we start with the Introduction to SAP S/4HANA Finance solution for advanced payment management.

Business Needs

As organizations scale up, there is significant increase in payment volumes and hence need to automate, streamline, optimize the end-to-end payment process across the entire group. Headquarter need the centralization of the payment approval and monitoring for subsidiaries by using a single source of truth. They need the ability to handle different payment formats centrally and automate the routing of payments to different financial institutes. They need the ability to leverage the in-house banking model to reduce the operating cost, bank fees with external banks and to get centralized view on the group’s cash position.

Solution

SAP S/4HANA Cloud for advanced payment management, public edition is the cloud solution released since 2005 and for on premise customers the solution SAP S/4HANA Finance for advanced payment management is released with 1809 FPS2.

The solution offers-

Central Payment Factory on SAP S/4HANA Cloud or on premise

• Offers centralized payment factory for subsidiaries on SAP and non-SAP source systems
• Option for a single bank connectivity for all payments
• Leverage preinstalled access to list screening solutions and services

Allows visibility and traceability of all payment activities from a single dashboard

• Eliminate the need for multiple payment monitors and bank portals
• Visualize an overview of the group wide cash flows and financial status

API based standard integration to SAP Multi-Bank Connectivity 

• Automate the routing of payments to different financial institutes

Foundation for company’s Inhouse-Bank

• Native integration with corresponding SAP applications for payment and cash management

Capabilities

Solution Architecture

Above diagram shows the solution architecture summarized as below.

• Payments can be initiated in local systems of the subsidiaries or affiliates or lines of business. These local system can be SAP or non-SAP and can be on-premise or cloud solutions. In the SAP reference architecture, all systems of heterogeneous landscape can submit their payment to a centralized payment factory (S/4HANA Finance for advanced payment management). This can be achieved using web services (APIs), IDocs or even physical files.
• Within advanced payment management the payments are converted to an internal format and are processed based on the configured rules potentially resulting in updates to SAP Cash Management, postings to GL. During processing, the solution leverages the Bank Account Management information to determine the bank to be used and triggers the final approval via Bank Communication Management.
• Once the payment is approved, the external payment format is generated leveraging DMEEX format and gets passed via the standard integration to SAP Multi-Bank Connectivity. The bank integration via SAP Multi-Bank Connectivity is fully API based and therefore adds another layer of security and is removing batch processes for file-based integration.
• The advanced payment management solution provides centralized view on global cash positions or status monitoring and features to handle exceptions and to optimize payment execution including bank determination.

Roadmap

Find the list of innovations in the Roadmap here – Payments and Bank Communications

Additional Information –

SAP Help Portal  – Advanced Payment Management

SAP Best Practice Explorer – Advanced Payment Management

SAP Learning Hub Session (E-Learning S4F42_EN_Col20) – Advanced Payment Management