• ProducePay sits between buyers (grocery stores and distributors) and sellers (growers), providing capital to growers and collecting payments from buyers. The company needs to manage a high volume of complex transactions at scale.
• Since its partnership with Modern Treasury, ProducePay has developed a centralized payments infrastructure and automated up to 70% of workflows to reduce errors and handle transactions efficiently. Processing payouts via the Modern Treasury API enables ProducePay to handle bulk transfers–improving their customer experience and reducing wire fees.
• Modern Treasury gives ProducePay and its customers greater visibility into real-time transactional data, driving better reporting and decision-making. With Modern Treasury, ProducePay feels it can grow, scale smoothly, and provide additional value to its customers.

Founded in 2014, ProducePay’s mission is to transform the agricultural industry with a transparent and predictable commerce platform that eliminates food waste. With a focus on international customers, ProducePay provides financing, payments processing, program management, and supply chain visibility for produce companies.

The payment and reconciliation process in the trade finance and produce market are especially complex due to the number of transactions and the particular pricing dynamics of the produce industry. ProducePay typically deals with a high volume of low to medium value invoices, which can result in an increased risk of errors and difficulties in sending precise payments at scale.

Additionally, unlike other financiers, who use hard securities as collateral, ProducePay uses the crops themselves. This adds further complexity, as perishable produce has greater volatility in terms of volume and pricing, which requires more attention in the financing, invoicing, and payment process. Invoiced amounts and paydowns may differ due to the unpredictability of the produce market, making the reconciliation process more nuanced and challenging.

“Produce is a bit like scrap metal: when you send something, and you invoice for it, it's very rarely, if ever, the amount of money that gets paid. There are a lot of deductions for quality issues and other things. So, it's a particularly complex reconciliation process,” says Jenna Cohen, VP of Treasury at ProducePay.

As an innovative financier tackling a challenging industry, ProducePay also needed to disburse funds at scale for their growers, and they needed to reconcile incoming funds as those loans were paid. For example, a blueberry grower would access capital through ProducePay to finance the growing and harvesting of their crop. Instead of the grower paying back the loan, ProducePay collects payment from the buyers to pay down the financing. ProducePay invoices the buyer, but the final amount the buyer pays often differs due to deductions. Additionally, buyers may work with multiple sellers and include numerous invoices or payment methods, making attribution more difficult.

As Director of Financial Products, Kristen Perizzo, shares, ProducePay may receive “50 invoices that are all for $25,000, and they're all for blueberries because they're all going to different places.” Each invoice may have more than one invoice number, with one coming from the seller in addition to the invoice number ProducePay assigns to it. These factors make the reconciliation process significantly more challenging, especially given the fact that ProducePay was manually entering data for all transactions and using several tools to do so. Doing this type of reconciliation by hand—with changing dollar amounts and multiple invoice numbers—can be difficult and potentially very costly if done wrong.

Seeking to scale the business and better serve customers, ProducePay saw an opportunity to increase efficiencies. By automating payment operations and integrating systems through Modern Treasury, ProducePay eliminated manual processes and minimized errors while improving data quality and visibility of all transactions. ProducePay says that about 70% of their work is now automated via Modern Treasury.

Instead of manually recording each incoming payment or initiating outgoing payments through different banking platforms, payments are automatically recorded in ProducePay’s Ledger and customers’ virtual accounts through Modern Treasury. Unifying transactional data allows the company to track every transaction and balance more accurately.

“We centralized all the accounts into one place. It’s easier for us to track things rather than going onto different banks and portals to check everything. So that makes tracking easier in terms of standardizing everything and centralizing it into one spot,” ProducePay Finance Operations Senior Director, Maggie Cheng, recalls.

Modern Treasury gave ProducePay the flexibility to grow and scale while working with its preferred bank partners and payment rails, including processing international wire transfers to better serve customers outside the United States.

As Cohen puts it, "One of the options in our evaluation was to build our own integrations. As an Agri-tech company, in-house payments tools is not part of our core value proposition and we made a strategic decision not to spend the time, money, and engineering resources building these tools. It's not just the launch. We would have had to maintain that system at great cost and effort. Going with Modern Treasury saved us at least six months of time for each bank integration."

Now, ProducePay uses Modern Treasury to automatically disburse and track funds, giving teams real-time visibility into growers’ account balances and making it easier to track receivables or make credit decisions. By integrating Modern Treasury with internal tools, ProducePay can reconcile incoming funds more seamlessly and get better audit trails. Modern Treasury helps the company allocate certain fees, identify excess funds, and automate rebate payments to growers via the integration between ProducePay’s enterprise resource planning (ERP) system and Modern Treasury.

Since implementing Modern Treasury solutions, ProducePay has achieved 60-70% in operational efficiencies, putting them in a strong position to scale. Today, ProducePay uses Modern Treasury’s payments, ledgers, and reconciliation solutions to automate incoming and outgoing payment workflows for a better customer experience.

“Modern Treasury eases a lot of anxiety around money; it gives us systems and data that we trust. As we grow, we won’t have to worry whether we’ll be able to support larger accounts or customers, and we can focus on the fun stuff, like better customer experiences,” Perizzo says.

For example, ProducePay plans to drive further efficiencies with Modern Treasury’s payment templates. With templates, the team can standardize payment orders to reduce manual, repetitive payments, improve data accuracy, streamline reporting workflows, and accelerate team onboarding. Not only will this save time, but they’ll also help ProducePay send faster payments at scale.

Cohen confirms, “The most valuable part of Modern Treasury, including features like payment templates, has been the data and the quality of the data that we get out because we're responsible for the review cycle, like checking cash data to loan tape data.”

With an efficient payment process in place, ProducePay continues to develop more valuable solutions for customers, such as embedded payments and virtual accounts to further enhance visibility. ProducePay hopes to make the customer experience even more transparent by allowing growers and buyers to track shipments and process transactions in-product. Not only is this solution more convenient for customers, but it also makes the reconciliation process much more efficient and supportive of rapid growth.