Podcast August 25, 2021

Payment Operations: Work smarter, not harder with Sam Aarons

Don’t kid yourself: payments are a subsystem of a business operation. Receiving and uploading invoices, getting authorizations, loading accounts and recipients, actually paying them, reconciling transactions — it’s easy to get overwhelmed long before you even reach enterprise scale.

Understanding what goes into payment operations made it easy for Sam Aarons to offer an end-to-end solution for managing this. We’re delighted that Sam took some time to speak with us, and share his wisdom as the Co-Founder & CTO of Modern Treasury .

What’s the point of using Modern Treasury?

Entry-level work in a finance team isn’t the cutting edge experience that most people hope for, especially going in fresh after graduation. One of Modern Treasury’s greatest successes is freeing up human resources within businesses.

Sam’s team automate and integrate these three pillars:

  • Payments
  • Reconciliation
  • Accounting

Before Modern Treasury: hire 30 finance professionals to get things done by hand, or spend six months building a tool to cover a single use case (while the work still piles up in the background).

After Modern Treasury: Automate. Integrate. Move on to the exciting stuff that finance professionals are qualified and hungry to work on.

Modern Treasury’s removing the need for you to read over 1000 pages of documentation, to figure out your ACH, wire and SFTP systems. How long would it take each person to go through that in your business?

Will a payment operations platform suit your business?

Know any business that doesn’t work with payments? Neither do we.

This solution fits all industries and scales of companies operating within them.

Right now Modern Treasury is making life easier for insurance, healthcare and real estate businesses, among others. Their clients range from home-based three-person operations to listed companies. Our point is that it’s working for all of them.

If he had to choose a single defining customer quality, Sam says that it would be the need to move a lot of money in and out of the business as a core component of the operation.

The Modern Treasury payment operation in action

With multiple bank accounts and tens of thousands of payments, insurance companies like SANA use Modern Treasury to orchestrate the movement of funds throughout the business.

SANA offers health insurance for employees of businesses so they need to debit those companies according to their payroll cycles. Here’s how they take advantage of Modern Treasury:

  • SANA uses Modern Treasury to initiate those ECH debits and reconcile transactions.
  • Once funds reflect in the SANA-controlled bank account, Modern Treasury is used to segregate funds into specific bank accounts for designated use, like regulatory fees.
  • As funds are debited from customers using Modern Treasury, more context is added. Let’s say $500 is debited from a company of 10 employees: SANA’s able to differentiate what specific amount within that relates to each employee’s contributions and coverage.

What’s the right approach to system integration?

Every CTO has a firm belief about how integration should be approached. Sam’s position is to understand before acting.

To build an effective interface into another platform, you need to understand both elements separately as well as their relationship with each other. This compounds as you integrate with more systems (ERP, accounting, banking etc.).

You need to understand the entire landscape to know where your patch of work fits in.

“We think of Modern Treasury as a giant abstraction system, over multiple bank interfaces, accounting or ERP software.” — Sam Aarons

The key to Modern Treasury’s integration success is meeting their customers where they are. They’re not prescriptive or limiting your system use so they’ll help you integrate what you use instead of asking you to change banks. The power of convenience becomes clear in the way you work with them.

Ledgers: expanding the right approach

Modern Treasury’s recently launched solution, Ledgers, is the first element that can be used as a standalone tool. It’s been built to do the same thing that the rest of the functions do: save people time and energy in getting double-entry accounting systems up and running.

There’s power in having a straightforward interface. ” — Sam Aarons

The world continues to shift from needing mediators, like banks, to manage transactions toward enabling and embracing direct access and control. Thanks to fintech like Modern Treasury, there’s less need for a ‘middle man’ when you’re looking for financial products and services.

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Until next time!

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