This document discusses key decisions for implementing the disbursements feature in Oracle Fusion Payments. It covers: - Setting up payment methods, profiles, validations and formats to support business processes for decentralized, centralized or factory payment models. - Choosing between broad or targeted invoice selection criteria to optimize payment creation. - Configuring validation rules and security at the document, payment or file level based on processing goals. - Tailoring human-readable and transmission formats to bank requirements.

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This document provides an overview of features and enhancements included in Oracle Fusion Applications 11gR1 Release 11.1.1.5.0
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3. <Insert Picture Here>
Oracle Fusion Payments
Implementation and Configuration Considerations

4. Agenda
1. Key Feature: Disbursements
•
•
•
•
•
Prerequisites
Feature Summary
Deltas with EBS
Key Decisions and Best Practices
Relevant Setup Tasks
1. Key Feature: Funds Capture
•
•
•
•
•
4
Prerequisites
Feature Summary
Deltas with EBS
Key Decisions and Best Practices
Relevant Setup Tasks
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5. Disbursements
5
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6. Prerequisites
• The concepts covered in the following Fusion Version
1 TOIs are prerequisites for understanding this
implementation document:
• Manage Payments L3: Prepare and Record Payments
• Manage Payments L3: Process Payment Files
• Set Up Procurement L3: Define Disbursements and
Configure Payment System Connectivity
6
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7. Feature Summary
Key Terminology
Payment Process Profile
Payables
User 1
Payment
Process
Request 1
Payment
File
Payment
Build
Pool of Built
Payments
Select Documents
Transmit
Payments
Payment
File
Print
Payments
Payment
File Creation
Payable
Payables
User 2
Payment
Process
Request 2
Payment
Build
Select Documents
Payable
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8. Deltas with EBS
• Terminology Change: Payment Instruction changed to
Payment File
• New setup entity Payment Code combines three EBS
setup entities:
• Delivery Channel Code
• Bank Instruction Code
• Payment Reason Code
8
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9. Key Decisions and Best Practices
• What is your business process?
• Decide how much to automate
• What is your organizational structure?
• Support for decentralized, centralized, payment factory
models
• What are your processing goals?
• Targeted invoice selection or least effort
• What payment methods do you need?
• Broad, or granular with validations
9
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10. Key Decisions and Best Practices
• What validations do you need?
• Payment method or format
• User defined or predefined
• Document payable, payment, or payment file
• What formats can you use?
• Configuring or customizing for your needs
• Security (Encryption and Masking)
10
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11. Key Decisions and Best Practices
What is your business process?
• Straight Through Processing
• Advantages:
• Fewer touch points means less effort
• Exceptions handled outside the payment process, good
payments not held up by the few exceptions
• Tight Manual Control
• Advantages:
• Allows manual review and confirmation of payments in
process
• Allows step to be initiated manually to fit specific timing
needs
Note: Any combination of manual and automated steps can be used. It is not necessary to
be completely automated or completely manual. The best practice is to automate
everything except manual review of either selected invoices or proposed payments. See
following slides for further options and best practices.
11
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12. Key Decisions and Best Practices
What is your business process?
• The following settings control automation of steps
throughout the payment process:
Page
Details
Manage
Disbursement
System Options
•Validation error
handling
•PPR Status report
submission
Validation error handling setting defaults to
payment process request (PPR) templates
or directly to Submit PPRs page if no
template is used
Create Payment
Process Profile
•Printing
•Transmission
•Reporting
Set for automatic initiation or manual
initiation. Reporting includes payment file
register, positive pay, and separate
remittance advice
Submit Payment
Process Request
12
Options
•Validation error
handling
Choose to automatically remove any
documents or payments with errors and
progress valid items, or stop the process
and review errors
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13. Key Decisions and Best Practices
What is your business process?
• Optional stopping points for review during the
payment process:
Page
Details
Manage
Disbursement
System Options
•Review proposed
payments
Setting defaults to payment process request
(PPR) templates or directly to Submit PPRs
page if no template is used
Submit Payment
Process Request
13
Options
•Review selected
installments
•Review proposed
payments
Best practice: While you can stop at both
points, it is recommended to stop for review
at most once. The stopping points offer
different values, so pick the one that suits
your needs best
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14. Key Decisions and Best Practices
What is your business process?
• Best practices for process submission
Object
Best Practice
Payment Process Create one template for each unique combination of submission
Requests
attributes. Ensure your templates cover all normal cases – avoid
off-cycle payments and the associated costs.
Do not enable Create Payment Files Immediately, as this will
limit payment file creation to within a single PPR.
Create a scheduled process for each template to create PPRs
automatically. This should be run frequently enough to meet due
dates, as well as to take advantage of early payment discounts.
14
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15. Key Decisions and Best Practices
What is your business process?
• Best practices for process submission
Object
Best Practice
Payment Files
Create one or more scheduled processes that will run after all
PPR processes complete. The payment file will pick up any
waiting payments with the proper attributes, regardless of which
PPR they originated in, allowing for the fewest number of
payment files possible.
Fewer payment files result in lower transaction processing
costs.
15
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16. Key Decisions and Best Practices
What is your organizational structure?
Decentralized
Invoice
Entry
BU A
Invoice
Selection
BU A
Payment
Processing
BU B
BU B
BU A
BU B
Centralized
Centralized
Invoice
Entry
BU A
Centralized Invoice
Selection
Centralized Payment
Processing
BU A & B
BU B
BU A & B
BU A & B
Payment Factory
Invoice
Entry
BU A
BU B
16
Invoice
Selection
BU A
Centralized Payment
Processing
BU A & B
BU B
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BU A & B

17. Key Decisions and Best Practices
What is your organizational structure?
• Decentralized Processing
• Enable each BU to create its own payment process
• Enable each BU to decide who and when to pay
• Centralized Processing
• Reduce manpower costs by centralizing payment process
decisions and exception handling
• Reduce payment processing costs by pooling payments
together into fewer payment files
• Efficiencies of scale allow some users to specialize in
payment processing
• Payment Factory
• Enable each BU to decide who and when to pay
• Reduce payment processing costs by pooling payments
together into fewer payment files
17
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18. Key Decisions and Best Practices
What are your processing goals?
• Select invoices to be paid with a broad selection
criteria, thus creating as few payment process
requests as possible
• Recommended for a Centralized Processing model
• Payment process templates can be more generic, and fewer
of them
• Best practice for supporting broad selection is to ensure that
only one payment process profile (PPP) is active per unique
set of transactional attributes (business unit, payment
method, disbursement bank account, and currency)
• System can derive PPP automatically per payment,
instead of forcing all payments in a payment process
request to have the same PPP
18
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19. Key Decisions and Best Practices
What are your processing goals?
• Select invoices to be paid with targeted selection
criteria, thus allowing precise control over time
• Recommended for Decentralized or Payment Factory models
• Allows different types of payments to be managed in separate
processes, for example expense reports Monday, domestic
supplier payments Tuesday, and so on
• Best practice to support targeted selection is to create
specific payment process templates for each type, using pay
groups, payment priorities, or other targeted selection criteria
19
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20. Key Decisions and Best Practices
What payment methods do you need?
• Choose broad payment methods like the seeded
Check and Electronic, or choose to create your own
more granular payment methods, optionally with
targeted validations
• Use laser printed checks rather than numbered checks when
possible.
• For a detailed discussion of the costs and benefits of
more granular payment methods, see topic ‘Payment
Methods: Explained’ in the ‘Define Disbursements’
chapter of the Implementation Guide
20
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21. Key Decisions and Best Practices
What formats can you use?
• Favor standards-based formats that can be used with
multiple banks
• EDIFACT formats (PAYMUL, MT100, MT103, etc)
• NACHA formats (Generic, CCD, PPD, etc)
• Find out what your processing bank supports
• Modify seeded formats using BI Publisher
• An XML extract provides Payments data
• Use RTF templates to create or modify human-readable
layouts, for checks and reports
• Use ETEXT files to create fixed-position layouts, for
transmission and automated payment processing
• For a more detailed discussion of tailoring formats to your
needs, see the white paper ‘Format Customization In Oracle
Payments’ at support.oracle.com
21
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22. Key Decisions and Best Practices
What validations do you need?
• You can use prepackaged validations designed to
match specific formats
• You can create your own validations for almost all
transaction attributes
• Layer them on top of prepackaged validations when formats
or regulations change
• Or use them to create entirely new validations for your own
formats
22
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23. Key Decisions and Best Practices
What validations do you need?
• Validations can be associated with payment methods or
formats
• Validations can be performed at the following levels:
• Document payable
• Payment
• Payment File
• Documents payable are validated during invoice entry if
the validation is associated with a payment method…
• Immediate feedback
• Fastest way to resolve errors and make payments
• Requires knowledgeable invoice entry personnel and a larger
number of payment methods with different validations
associated
23
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24. Key Decisions and Best Practices
What validations do you need?
• … Or after payment process request submission if the
validation is associated with a format
• Allows a specialized payment process manager to queue up
and resolve errors
• Allows fewer payment methods and requires less knowledge
for invoice entry personnel
• For a detailed discussion of the costs and benefits of
validations, see topic ‘Validations: Critical Choices’ in
the ‘Configure Payment System Connectivity’ chapter
of the Implementation Guide
24
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25. Key Decisions and Best Practices
Security
• Use the Positive Pay File to reduce fraud
• Encrypt and mask supplier bank account numbers
before importing or entering any data in the system
• Use Oracle Wallet Manager to create a wallet
• Store wallet in a very secure, limited access file
system location
• Obtain encryption keys externally, or have Payments
generate them
• Rotate encryption keys periodically
• See System Security Options: Critical Choices in the
Implementation Guide
25
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26. Relevant Setup Tasks
•
•
•
•
•
•
26
Payment Methods
Payment Process Profiles
Validations
Formats
Transmission Configurations
System Security Options
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27. Funds Capture
27
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28. Prerequisites
• The concepts covered in the following Fusion Version
1 TOIs are prerequisites for understanding this
implementation document:
• Process Customer Payments L3: Manage Funds Capture
• Set Up Order Fulfillment L3: Define Funds Capture and
Configure Payment System Connectivity
28
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29. Feature Summary
Key Terminology
Receivables
User
Internal
Payee
Routing
Authorization
Payment
System
Funds Capture Process Profile
Receipt
Creation
Receivables
User
Settlement
Settlement
Batch Creation
Payment
System
Remittance
Payment
System
Settlement Batch
Acknowledgment
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Receivables

30. Deltas with EBS
• Improved Transaction Exception handling, through
Accounts Receivable
30
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31. Key Decisions and Best Practices
•
•
•
•
•
•
31
What Payment Methods to Accept
What Payment Systems to Use
What Formats to Use
What Transmission Protocols to Use
Security Setup: Encryption and Masking
Tying It All Together: Internal Payee
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32. Key Decisions and Best Practices
What payment methods to accept
• Credit Cards
• Implement additional features to reduce processing fees
• Company card support
• Address verification
• Card verification code
• Bank Account Transfers
• Payer-initiated payment methods (such as checks
and cash) are recorded directly in Oracle Fusion
Receivables
32
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33. Key Decisions and Best Practices
What payment systems to use
• Leverage existing banking or processing relationship
• Your bank may process transactions, or have a partnership
with a processor
• Leverage processors with existing integrations with
Oracle Payments EBS
• Chase Paymentech (Certification Pending)
• First Data Global Gateway (formerly Concord EFSnet)
(Certification Pending)
• PayPal PayFlow Pro (Certification Pending)
• Other existing integrations have been built by gateways or
consulting firms
33
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34. Key Decisions and Best Practices
What formats to use
• Find out what your processing partner supports
• For a detailed discussion of tailoring formats to your
needs, see the white paper ‘Format Customization for
In Oracle Payments’ at support.oracle.com
34
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35. Key Decisions and Best Practices
What formats can you use?
• Modify seeded formats using BI Publisher
• An XML extract provides Payments data
• Use RTF templates to create or modify human-readable
layouts, for checks and reports
• Use ETEXT files to create fixed-position layouts, for
transmission and automated payment processing
• For a more detailed discussion of tailoring formats to your
needs, see the white paper ‘Format Customization In Oracle
Payments’ at support.oracle.com
35
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36. Key Decisions and Best Practices
What transmission protocols to use
• Find out what your processing bank supports
• Favor transmission protocols seeded in Oracle Fusion
Payments
• Use Funds Capture Process Profile for greater
configurability in transmission and formatting
• Avoid name-value pair approach
36
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37. Deployment Architecture
External Connectivity
End Users
Router over Leased Line
DMZ Public Zone
OR
HTTP Load
Balancing
Payments
Transmission Servlet
Internet
DMZ Secure Zone
Payment System
Application Tier
Intranet
Database Tier
37
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38. Key Decisions and Best Practices
Security
• Comply with PA-DSS Security Standards
• Hard requirement for accepting credit card payments
• Minimize risk of exposing sensitive customer data
• Work with an PA-DSS auditor to ensure compliance and
avoid potential violations
• Encrypt and mask customer credit card and bank
account numbers before importing or entering data
into the system
38
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39. Key Decisions and Best Practices
Security
• Use Oracle Wallet Manager to create a wallet
• Store wallet in a very secure, limited access file
system location
• Obtain encryption keys externally, or have Payments
generate them
• Rotate encryption keys periodically
• See System Security Options: Critical Choices in the
Implementation Guide
39
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40. Key Decisions and Best Practices
Security Gotchas
• Bank account numbers are not encrypted immediately
upon entry
• Configure the Encrypt Bank Account Data program to run
frequently
• Credit Card Numbers that are entered through PLSQL
(via migration or import) are not encrypted
immediately
• Run the Encrypt Credit Card Data program after imports
40
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41. Key Decisions and Best Practices
Tying It All Together: Internal Payee
• Transactions are identified by Business Unit, but are
processed by Internal Payee
• If all Business Units require identical processing, create one
internal payee to serve them all
• If Business Units require different processing, create one
internal payee per business unit
• In a mixed model, use Routing Rules to determine how to
process each transaction
41
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42. Relevant Setup Tasks
•
•
•
•
•
•
42
Payment Methods
Funds Capture Process Profiles
Internal Payees
Formats
Transmission Configurations
System Security Options
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43. <Insert Picture Here>
Oracle Fusion Payments
Implementation and Configuration Considerations