Fueling Your Business Growth with B2B Payments Innovation

US Small-medium-sized enterprises (SMEs) that deal with B2B payments know the challenges of late payments, payment disputes, lack of payment visibility, and security risks.? Addressing these pain points is critical for SMEs to improve their cash flow, reduce costs and manage their business more effectively.?

With the advancement of digital technologies, the payment ecosystem is seeing several exciting opportunities in solving these pain points and creating innovation in the B2B payments space.??

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B2B vs. B2C payments: key differences explained?

B2B payments is the exchange of monies between business entities for goods or services supplied. These payments could happen one time or be recurring, according to the terms of the buyer and seller agreement. Depending on the industry you are working in, B2B Payments could span across any of the many customer and supplier scenarios.?

The payment decision-making process in B2B payments differs from B2C payments. With B2C payments, a customer can purchase products and services for themselves, so the decision-making on whether to buy something is often left with a single person.?

When it comEs to B2B payments, the decision-making process is much more complex and riskier. This is due to B2B purchases often being more expensive and involving larger quantities of goods and services. To mitigate this risk, purchases must go through an authorization process, which could touch several people before sign off occurs and money moves for the purchase.?

This pattern of complexity continues with B2B payment methods. For example, B2B payments can be made using:??

• Real-Time Payments (RTP) through networks, such as The Clearing House? (TCH) or FedNow???

• Automated Clearing House (ACH)/Electronic Funds Transfer (EFT)?

• Corporate Credit Cards?

• Virtual Credit Cards??

• Wires?

• Paper Checks?

• Cash?

On the other hand, B2C payments are often made using more traditional payment methods, such as:?

• ACH?

• Debit/Credit Cards?

• Mobile Wallets?

• Paper Checks?

• Cash?

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B2B payments: faster payments modernization is here?

SMEs are now using more technology than ever in running their businesses, and they want to move faster and run operations more efficiently and the expectation of faster payments has increased. They now have multiple options to move money quicker and more efficiently with the following benefits:?

Improving Efficiency: Getting paid for goods and services, through traditional payment methods, can be time-consuming and can take several days to process. Faster B2B payments, on the other hand, can be completed in real-time or within a matter of hours, allowing businesses to streamline their payment processes and improve their cash flow.?

Lowering Payment Costs: Faster B2B payments can also help SMEs reduce their payment processing costs. Traditional B2B payment methods often come with higher transaction fees, processing and other charges. Faster B2B payment methods offer lower transaction fees and can be processed at a lower cost, which can help SMEs save money in the long run.?

Enhanced Security: Digital B2B payments provide enhanced security features like encryption and authentication to protect against fraud and unauthorized access to payment information. Couple this with B2B payment platforms and SMEs can use features like payment tracking and reporting, which can help?businesses better manage their payment processes and reduce the risk of errors or discrepancies.?

With B2B payments becoming more digital and faster, they are also becoming embedded into the SME ecosystem. We are seeing exciting innovations that are going to push B2B growth and provide new opportunities for SMEs to grow their business and run their business more efficiently and effectively.?

Access to Finance: Payment platforms can help SMEs access financing by providing them with working capital loans, invoice financing and other funding options. This is crucial to help SMEs manage their cash flow and grow their businesses more effectively.?

Integration with Accounting Systems: Embedded payment solutions can integrate with SMEs’ accounting systems, providing a seamless payment and accounting experience. This can help SMEs manage their costs more efficiently and reduce the risk of accounting errors.?

Automated Invoicing and Payment Processing: Embedded payment solutions can automate the invoicing and payment processing process, reducing the need for manual intervention and streamlining the payment process. This can help SMEs save time and reduce administrative costs.?

Streamlined Checkout Processes: SMEs can embed payment solutions directly into their checkout process, allowing their customers to pay quickly and easily without having to leave the SME’s website or platform. This can improve the user experience, conversion rates and help SMEs sell more.?

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The B2B/B2C connection?

Even though there are distinct differences between B2B and B2C payments, they also complement each other well. If you can find that middle ground in balancing the needs of SMEs and consumers, you can provide a seamless payment experience for all.?

To deliver on this seamless experience, all roads lead to ‘Embedded Payments & Finance’, which will allow SMEs to offer more sophisticated payment services directly to their customers and suppliers, removing many of the historic frictions associated with B2B payments.?

Embedded payment and finance experiences have now enabled payments to be integrated into previously nonfinancial processes or platforms. These types of experiences have become increasingly popular on the consumer side.?

The use of buy now, pay later (BNPL) has grown in popularity as a payment method where consumers can now split large purchases into smaller installments at the point of sale (POS).? SMEs that can offer a variety of payment options to consumers at the POS, such as mobile payments, and other digital payment methods will make buying of their product and service easier.?

This balancing act between B2B and B2C payments takes SMEs and consumers to unified payment platforms that can handle multiple payment types and provide a consistent user experience across different payment channels, both online and offline.?

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Unlock new pathways to growth and success?

The outlook for US B2B payments is extremely positive. SMEs can expect to benefit from increased access to financing, improved efficiency and better payment security, enabling a seamless experience for their customers and consumers. B2B payments will continue to evolve further and offer new opportunities for businesses to grow and succeed.?

For more on B2B payments, download our eBook.