PaymentWorks has announced the release of the 2026 Vendor Onboarding and Master Data Management Study, a research effort commissioned by PaymentWorks and conducted by The Hackett Group. The study finds that growing vendor complexity is straining the processes organizations rely on to maintain accurate supplier information, manage vendor changes, and mitigate payment risk.

Vendor master data stored in enterprise resource planning (ERP) systems contains the supplier identity information that drives procure-to-pay processes, from purchase orders through payments. As vendor populations and data changes grow, the research shows that manual processes, fragmented governance, and uneven automation can create significant downstream inefficiency, cost, and risk.

Large and Diverse Supply Chains

Respondents reported supply chains that are both extensive and increasingly complex. 58% of organizations manage more than 5,000 active vendors globally, a sign of the growing diversity and complexity of corporate supply chains. Another 49% process more than 5,000 supplier data changes annually, revealing the burden placed on organizations to keep data clean and accurate. Because each of those records feeds the purchase orders and payments that flow through procure-to-pay, volume at this scale magnifies the impact of even small data errors.

Automation and Governance Gaps

According to the study, many organizations lack the automation and governance models needed to manage the function. 66% report onboarding processes that are mostly manual or only partially automated, while 53% operate under partially centralized or decentralized governance models, pointing to a lack of oversight and controls. Manual verification remains the dominant model for handling supplier-submitted updates, leaving staff to distinguish legitimate change requests from fraudulent ones — the very risk most respondents say worries them.

Significant Operational Costs

Maintaining vendor master information carries substantial operational cost. 55% of respondents do not track — or are unsure of — their vendor onboarding and maintenance costs, meaning the true financial footprint of the function goes unmeasured at many organizations. Among organizations that do track and report these costs, the average annual cost to onboard and maintain a vendor is $182. That per-vendor figure suggests the average organization spends more than $1 million annually on full-time equivalent (FTE) costs to manage its vendor master file.

Downstream Cost and Risk

Inaccurate or incomplete vendor master information creates substantial downstream cost and risk. 94% of respondents are concerned about vendor payment fraud and vendor impersonation, and 37% experience vendor data issues frequently or very frequently. Common consequences include failed or delayed payments, manual rework, supplier inquiries, duplicate or conflicting records, and audit and compliance issues.

Rising Recognition of Strategic Value

Organizations increasingly recognize the strategic value of trusted vendor master data. 89% rate clean and well-governed vendor data as a high- or very-high-value capability, 88% believe improved vendor data accuracy and consolidation would support supplier consolidation and rationalization, and 85% cite benefits in process efficiency and reduced operational complexity. That recognition stands in contrast to the operating picture documented elsewhere in the study, where onboarding remains largely manual and governance fragmented — the same gap between ecosystem complexity and operational maturity that The Hackett Group's researchers highlighted.

Vendor Identity in the Age of AI and Agentic Commerce

The findings arrive as businesses and financial institutions grapple with AI-enabled impersonation and agentic commerce, including how identity, authorization, and liability are established when software acts on behalf of companies. In that environment, vendor identity and banking information become more than back-office records: they are part of the trust infrastructure required to determine who a business is transacting with, whether information changes are authentic, and what humans or agents are authorized to do.

"Vendor master data is the foundation of all downstream procure-to-pay activities," said Thayer Stewart, CEO of PaymentWorks. "Organizations have either ignored it or decided it's too hard a problem to solve. However, with the explosion of vendor impersonation scams and the emergence of agentic commerce, it's the 'elephant in the room' that must be addressed."

"What stood out in the research is the growing gap between supplier ecosystem complexity and operational maturity," said Annie Cody-Nesser, Senior Manager, Procurement and Purchase-to-Pay Applied Intelligence at The Hackett Group. "Many organizations continue to rely on manual processes, fragmented governance and disconnected technologies to manage thousands of supplier records and changes each year. That reality underscores why vendor data management is increasingly viewed not as an administrative necessity, but as a strategic capability that supports risk management and enterprise performance."

Source: GlobalFinTechSeries