Every 12 seconds, a large organization loses one document, which costs it from 350 to 700 dollars per piece. It can also result in the violation of the law and severe penalties from regulatory bodies that monitor data storage and security. Missing statements affect both financial record-keeping and the experience of customers who don’t receive their documents in time.
Even though we still cannot entirely abandon paper statements and switch to paperless, it’s possible to combine them. Paperless statements will allow you to store electronic copies of all documents and share them online with customers, your team, and regulatory bodies. The standard print format can be used in parallel when you need to provide physical copies of paperless statements or other records.
For more details on paperless compliance and how to quickly achieve it, read about:
- Paperless compliance: Why do you need paperless statements?
- When to use paperless billing and when not to
- Four steps to switch to paperless billing
- Inkit’s tips on how to switch to paperless statements and stay compliant
Paperless Compliance: Why Do You Need Paperless Statements?
The Gramm Leach Bliley Compliance Act, the Payment Card Industry Data Security Standard, the Sarbanes–Oxley Act are just a few of the numerous regulations that control the use of financial data across industries. To meet these standards, you will need a reliable online data management system that stores all critical customer communications and provides an audit trail. Thus, if you’re a business, credit card issuer, or bank that generates paper-based statements, you should consider electronic documentation for paperless compliance. Only an electronic document management system can enable you to organize millions of records and quickly access them.
Here’re some other reasons to focus on paperless compliance:
Paperless compliance systems support access permissions
When you switch to paperless, you can choose who can view statements. First of all, document management systems allow you to restrict the permissions for end-users. Only the person authorized to access online banking or the specific email address will be able to check billing reports, credit cards, and other confidential data. On the other side, you also manage access permissions given to your personnel. This lowers the risk of data misuse and helps you meet regulatory requirements.
Personal information is better protected with encryption
When paperless statements are generated and transmitted to customers, the system automatically encrypts them. Thanks to this, hackers and other unauthorized individuals cannot steal critical information and cause serious problems resulting from data leakage for your company.
Paperless statements are more accurate thanks to automation
Paperless compliance is also about the accuracy of information. Mistakes in financial documents can make customers pay bills later than expected, misinterpret information from their checking accounts, and file disputes. Since online billing systems are highly automated, you won’t have to deal with human errors.
Paperless compliance systems are built with core regulations in mind
Tech companies that offer platforms for paperless statements consider all the related regulations at the product development stage. Thus, when you adopt such solutions, you get the software that ensures the necessary security level and helps your team store paperless statements by the rules.
Additional stability in case of a disaster
Even if hurricanes, tornadoes, and earthquakes rarely happen at your place, you need to remember about force majeure situations. Many modern paperless compliance systems store data in the cloud, which is much more reliable than keeping them in your office. If you lose paper records, you will always be able to restore them from the web.
Apart from the listed benefits, paperless statements are also less time-consuming than paper documents. Your team members won’t need to waste time turning filing cabinets upside down to find a single statement. Everything is available online. When you switch to paperless billing, you also reduce operating expenses on document printing and delivery. If an organization serves a large customer base, such an optimization makes a huge difference.
When to Use Paperless Billing and When Not to
Paperless statements are pretty universal. They can be used in banking, insurance, utilities, business, and other fields when one of the parties is entitled to financial reporting.
Nevertheless, sometimes to stay regulatory compliant, you must also provide physical copies of paperless statements. Actually, it’s impossible to entirely switch to paperless billing in the following cases:
- Banks must provide written statements for any month when a customer makes at least one debit card or ATM transaction, direct deposit, or electronic bill payment.
- Mortgage lenders and credit card issuers must provide monthly statements.
- Investment firms must provide statements for any month when the recipient was active or at least quarterly.
For the listed organizations, paper statements are required by law. They can only use paperless statements on par with physical reports to enhance customer experience and record-keeping. Even when combined with offline statements, electronic document management significantly optimizes their business processes.
Four Steps to Switch to Paperless Billing
Step #1. Consider your automation needs
Before you switch to paperless, you need to know how many processes are involved in billing in your organization, what personal data you process, who accesses this data, and what laws regulate your activities. This would help you understand what level of automation you need and what kind of software provides it.
Step#2. Choose multifunctional software
Once you are sure that paperless statements will benefit your company, it’s time to choose the software. Opt for a service that automates both paper-based and paperless documents. This will let customers choose the most convenient format. Note that according to recent data, 61% of people still prefer paper for credit card statements.
Besides, don’t focus solely on the tools for statement processing. The services like Inkit support custom communications and can also generate invoices, bills, late payment notices, etc. The broader the functionality, the more possibilities you have.
Step#3. Set up the paperless system and start training
Integrate the chosen paperless compliance service with your current system to generate and store documents in real-time. Set up access for the authorized teams and start training personnel on how to use the new software. You may request training materials or help directly from the software provider.
Step#4. Implement customer consent
Before you switch to paperless billing, you need to ask your customers’ opinions. When the law requires an organization to provide documents in writing, online reports can substitute them only at the request of the customer. Hence, to make the use of paperless statements software compliant, it’s necessary to add a consent request on your website or app. When a customer says “Yes”, you are free to start sending them paperless statements related to their checking or savings accounts.
Inkit’s Tips on How to Switch to Paperless Statements and Stay Compliant
Inkit is a Reach Enablement Platform offering the functionality for paperless statements. Our tool automatically verifies customer data, renders PDF statements, and delivers them both online and offline. To help you switch to paperless statements easier, we’ve formulated several guidelines:
- Consult with your legal advisor to know what regulations you need to meet
- Consider software solutions with built-in paperless compliance
- Aim to achieve a high level of automation for maximum efficiency
- Store historical bills in a secure location online
- Get ready to provide statements online and offline
- Send electronic bill reminders through email notifications
- Offer customers various incentives to convince them to go paperless
Want to test the paperless capabilities available in Inkit? Contact us to get the demo or start a subscription.