The Fast-Moving Consumer Goods (FMCG) sector is exactly that: fast-moving. Its demands include efficiency, quickness, and openness. Its diverse distribution networks make administering dues among channel partners extremely difficult.  Delayed payments, discrepancies, and disengagements marked the tones of the traditional modes of payments. And then came direct payments—the game changers in the FMCG sector. This blog shall decode the revolution in the sector through direct payments and its competitiveness factor.

What Is Direct Payment in FMCG?

Direct payments are the fluid transfers of money from one party to another that do not involve any middlemen. In the FMCG industry, this might imply that the corporation is directly paying its channel partner, retailer, or distributor not only speeds up the payment process, but also warrants more transparency and minimizes risk of errors or fraud.

Why FMCG Needs Direct Payments

The FMCG companies work through a large network of partners. Processing their payment is a nightmare in the traditional model. Payment delay, in the traditional model, burdens the relationship and reduces partner interaction. It may also impact pilferage. With direct payments, companies can now process their money efficiently and reliably, enabling them to have lifelong and strong relations with their partners.

How Direct Payments Help FMCG Companies

• Better Transparency and Trust
  Since intermediaries are eliminated, the direct payments serve as real-time records of all transactions. Such transparency gives both FMCG companies and their channel partners assurance, which fosters better business relationships.
• Lower Operational Costs
  Operational costs are pretty low since an FMCG company wouldn't need third-party payment processors. The money saved from transactions can be reinvested in some other areas within the business for growth and innovation.
• Improved Partner Engagement
  Keeping channel partners engaged and interested requires proper and timely payments. Direct payments ensure that partners are paid on time, which evokes greater contentment and hence loyalty.

Account Mein: Leading the Way in Direct Payments in FMCG

Leveraging the experience of the founders of Love in Store, Account Mein is today India's largest B2B channel payment company and is leading from the front in deploying the concept of direct settlement services to FMCG companies. Established on 1st January 2017, Account Mein has grown today, in less than four years, to handle INR 400 Crore of disbursals annually with more than 2 million transactions per year. Our services are trusted by 200,000 leading retailers in India, 50,000 distributors/sub-distributors, and 40,000 channel sales representatives.

Concluding Remarks
Direct payments have much more to being a fad in FMCG; it is the necessity of FMCG. Channel partners will continue to play their old conventional role in FMCG, but companies need to work for a better, improved, and more transparent way of executing the payment process. Account Mein leads the revolution and provides you a stable, proven, and scalable solution that is already changing the very nature of dealing with payments for large FMCGs in great numbers in India. If your business is keen on improving the sustainability of payments and enhancing engagement levels with partners, Account Mein can help. Reach out today and learn how we can help solve your channel program management needs.