What Are the Major Pain Points for B2B Payments?

As businesses continue to digitize their operations, there is a greater need for efficient and secure B2B payments. Despite the availability of various payment solutions on the market, businesses continue to face significant challenges in the B2B payments process.

In this article, we will look at the major problems with B2B payments and how businesses can solve them.

Key Issues Facing B2B Payments Space

High Transaction Fees

High transaction fees charged by payment providers are one of the most significant pain points for B2B payments. These fees, which can quickly eat into profit margins, can be especially burdensome for businesses with high transaction volumes.

Businesses should consider negotiating transaction fees with their payment providers to alleviate this pain point. They should also look into alternative payment methods, such as virtual cards, which can provide lower transaction fees and simplified payment processes.

Payment Security

Another major issue for B2B payments is payment security. With the rise of cyberattacks and fraud, businesses must ensure the security and protection of their payment processes.

Businesses should implement secure payment solutions, such as two-factor authentication and encryption to address this issue. They should also review and update their security protocols on a regular basis to stay ahead of emerging threats.

Payment Delays

Payment delays are a common source of frustration for businesses when it comes to B2B payments. These delays can cause cash flow issues as well as strained business relationships.

Businesses should establish clear payment terms and procedures with their vendors and clients to avoid payment delays. They should also use automated payment solutions to streamline the payment process and reduce the risk of late payments.

Payment reconciliation is the process of matching invoices and payments to ensure that all transactions are properly accounted for. This process, especially for businesses with high transaction volumes, can be time-consuming and error-prone.

Businesses should use automated payment reconciliation solutions to address this issue. These solutions can help to speed up the reconciliation process, reduce errors, and free up resources for other important business tasks.

Payment Options

Many B2B payment providers offer limited payment options, which can be inconvenient for businesses with specialized payment requirements.

To alleviate this issue, businesses should look into payment providers that provide a variety of payment options, such as wire transfers, ACH transfers, and virtual cards. They should also think about customized payment solutions that can be tailored to their specific business requirements.

Lack of Payment Visibility

Another major issue for businesses in B2B payments is a lack of payment visibility. Businesses may be unable to identify and address issues before they escalate if they do not have real-time visibility in their payment processes.

Businesses should use payment solutions that provide real-time payment tracking and reporting to address this issue. These solutions can provide businesses with the visibility they require to effectively manage their payment processes.

How Should Business Address Their B2B Payment Pain Points?

It is important that businesses, especially those who must deal with cross-border payments, fully understand their actual business capabilities versus what they want to do.

Modernizing businesses' payout capabilities is likely to correlate with a significant impact on the business’ growth as it will be granted access to incredible new opportunities.

We highlight 3 key aspects of cross-border solutions on which B2B payments should focus:

Embracing local payment methods as a viable cross-border B2B payment solution: legacy methods such as wire transfers (or even checks) are seemingly becoming less useful on the global landscape. While they shouldn’t be completely ruled out, finding local payout partnerships can be an incredibly handy tool to have at the ready.

Understanding how a fintech can help will go a long way: fintech's have been on a constant quest to reshape the financial landscape and payments are no exception. Whether a business is looking into standard B2B payments, cross-currency payouts, or cross-border payments, fintech's are likely to be able to help by integrating your transactions and getting your business faster time to market. Known for their flexibility, compliance, and fraud monitoring capabilities, fintech's can give your business the necessary room to grow.

Last but not least, virtual cards can present themselves as a fantastic idea for those looking out for a seamless to integrate, no-nonsense solution. By issuing their own cards, businesses can take control of all expenses, gain valuable insights, mine data from transactions, achieve much-needed simplification in payments, and even stand to gain with reward programs.

Wrapping Up

Finally, B2B payments can be a complex and difficult process for businesses. Businesses, on the other hand, can optimize their payment processes, reduce costs, and improve their overall business operations by addressing these major pain points.

Businesses can streamline their payment processes and stay ahead of emerging payment trends by leveraging automated payment solutions, negotiating transaction fees, and exploring alternative payment options.