First Free Story (1 of 3)Join Skift Pro
The pandemic’s being blamed for a surge in the number of expense rookies, who are whipping out the company credit card for items like big-screen TVs and soundbars to furnish their “home office.”
It’s a markup on the desks and donuts expensed during the summer. Now one booking platform is wooing company finance teams with a new platform designed to pinpoint fraud.
Since the lockdown, many organizations will have added new categories to accommodate work-from-home expenses. Because of this, more employees are filing for reimbursements, including a lot of first-timers, which leads to unintentional fraud.
Hey, Big Spender
Fraud activity violations increased 57 percent in the third quarter of 2020, compared to the second quarter, according to spend platform Oversight. Spend at electronic, computer and package stores triggered the majority of the violations.
Employees often bend the rules on equipment purchases, payment and procurement methods as they work from home, its November Spend Insights Report revealed. Expenses submitted as office supplies and meals/restaurants accounted for more than 25 percent of spend violations.
“The reality is that the pandemic has brought a 12 percent increase in new spenders, and introduced new patterns of risk that need to be accounted for,” said Terrence McCrossan, CEO of Oversight.
In August, Itilite soft-launched an expense tool to accompany its travel platform. It claims to have recently won a Fortune 500 company as a latest beta client. This firm previously managed travel in-house, but expenses with a third party.
But it’s a crowded market, and its co-founder and CEO knows this.
“There are a thousand different players in expense already,” said Mayank Kukreja.
Those travel platforms entering the market need to pick their battles. “For most companies, expense systems just capture data and fraud detection is left for finance teams — usually manually — during audits. Since we have built the platform covering the entire journey of travel-expense-audit, fraud is an essential piece we are able to target.”
It’s a change in tack for the former McKinsey consultant, who wanted to introduce the Indian market to the concept of incentives, as seen with the likes of Google’s in-house travel team, and Rocketrip. They help corporate employees book travel and offers incentives when the workers stay within the corporation’s budget and policy.
Kukreja also thinks Itilite has the edge over tech-focused rivals like TripActions and TravelPerk because its platform was built for large companies from the offset. New customers for 2019 included Tata Group, Toshiba, Ola and Indian delivery app Swiggy.
“In India, a small company behaves like a large company. That forced us to make our product enterprise-ready,” he said. Itilite has grown to 160 employees this year, with 48 joining since the country’s lockdown began.
Spotting the Patterns
Itilite isn’t the first to join the expense game, and won’t be that last. And its rivals are also aware of the increases in fraud.
TravelBank has returned to its expenses routes, and said its customers use its Premium Insights tool to spot potential fraud. “It allows admins to monitor spend, leakage and trends in one place, and can help spot abnormal patterns in expense spend. For example, if a user is expensing $5 repeatedly at a coffee chain like Starbucks, it could mean they are buying gift cards,” a spokesperson said.
TripActions also enhanced its Liquid tool in October to cater for larger companies, and said virtual cards are key to eliminating fraud. “Fraud and improper spending are events that the TripActions Liquid solution is uniquely equipped to handle,” said Meagen Eisenberg, its chief marketing officer.
“Fraud per se is not the only, or even most important, issue in travel and expense: most people are honest and very few employees are outright trying to steal from their employer. Often, however, many don’t know, or don’t try to learn, what’s allowed and what’s not. Unfortunately, most travel and expense providers don’t have the built-in features to mitigate either honest mistakes or fraud,” she added.
The pandemic put pause to Itilite’s planned move to San Francisco earlier this year, where the company aims to target organizations that travel frequently to India. “Fraud has been our selling proposition in India, and that’s going to be our selling proposition in the U.S.,” Kukreja said.