This article will help you be on par with the top B2B payment trends and be ready to boost your digitalization process for 2021. Updates might be made to always give you accurate information.
In the past decade, the B2B field has gradually shifted to digital payments. Today, consumers are spending more on contactless and cashless payment methods than ever before. In fact, in 2020 alone, the b2b market size was valued at $6.69 trillion in digital transactions. And it is estimated to reach USD 20,9 trillion by 2027.
At the same time, as COVID-19 continues to affect the way businesses process and pay invoices, the adoption of these digital payment methods is only accelerating. Whether you are new to digital B2B payments or not, this article is full of top trends on B2B digital payment that merchants should know to help them cope with 2021.
Before 2020, the B2B audience consists of baby boomers and Gen X members. Baby boomers prefer to obtain information from data sheets, sales literature, and product trials. On the other hand, Gen X seeks information from trade shows, conferences, and print advertisements.
As more and more B2B companies cross the digital threshold, the need for fast and efficient fulfillment processes becomes more and more urgent. Today, 73% of millennials participate in the B2B buying process. They want B2B companies to provide the same fast buying experience as B2C merchants.
Millennials have other expectations than their previous generations. In addition to a fast shopping experience, millennials want a customized checkout experience with a limited number of steps (preferably recognized in the checkout step) and pay the way they want.
Although artificial intelligence is in its infancy, it will affect B2B payments.
Eventually, it will change the way businesses of all sizes operate their financial operations.
Smart digital solutions will simplify processes, link systems, and accounts electronically, and realize all functions from automatic data entry to new automatic electronic payments.
Companies will rely heavily on digital end-to-end processes, freeing them up to focus on what is critical to them: building business and branding.
As a merchant, you don’t want to accept payments when the risk of fraud increases or the likelihood of refusals increases. On the other hand, refusal of “good” payments usually results in loss of conversion and therefore loss of revenue for the merchant.
Risk decisions in payment are never 100% certain, so they are ideal for deep learning techniques.
Cross-border B2B transactions generated approximately $130 billion in revenue in 2019 and continue to grow rapidly. In response to this growing opportunity, some new players have entered this field. The cooperation of digital payment participants and cross-border payment providers has led to the growth of fast and cheap digital payments.
Freelancers, self-employed individuals, and more still receive B2B payments through wire transfers and correspondent banking networks. This can be cumbersome, time-consuming, and cause several problems with payment settlement.
Changing foreign exchange rates, bank/wire transfer fees, etc. all make traditional solutions less attractive, creating a suitable environment for interruptions.
Cross-border payments are gaining momentum. Using modern tools can simplify and speed up cross-border payments and increase customer satisfaction by offering local payment methods.
Fintech and finance have been sweeping the blockchain revolution, and B2B payments are no exception. Although most organizations are still exploring blockchain and cryptocurrency payments, the incorporation of both into the B2B payments ecosystem has some advantages.
Blockchain can assist companies with KYC (Know Your Customer) and AML compliance requirements.
Some of the key advantages of using blockchain and cryptocurrency in B2B payments are fraud prevention, reduced amounts of paperwork, improved productivity in payment processing, transparent payments, the ability to keep a decentralized cash reserve, and fast (digital) identity verification
With one survey predicting that up to 25 percent of banks, suppliers, and retailers will use blockchain networks in some way, we are on the verge of greater acceptance, and in 2021, at least 25 percent of the top organizations in the world will use blockchain as a foundation for digital confidence and data protection.
It is estimated that blockchain networks will enable over $60B in cross-border payments by 2023. As the industry matures and blockchain-based technologies become more popular, more progress in this space is expected to increase.
Customers have been getting used to a fast and easy-to-operate payment system for the last few years. The B2B payment system is the ideal example of a payment system that is easy to run.
The Business to Business Payment system (B2B) meets the criteria of a personalized, tailored, and fast payment system for corporate customers.
The B2B payment system will provide you facilities like integrating digital payments, digitizing payment scheduling, invoicing, etc. The B2B or Business to Business Payment system is a transparent system on which you can depend to serve your consumers.
That is why the B2B payment system is going to be one of the dependable payment trends of 2021.
From paper checks to digital invoices and payments, global B2B payments have gradually but steadily changed. Given a large amount of payment processing in the industry, naturally, it takes longer to switch to digital automatic payments than B2C payments. However, with the integration of new innovative technologies (such as AI, blockchain, cryptocurrency, etc.), this switching becomes easier and easier. As industry benchmarks adapt to this faster and more efficient solution, it is only a matter of time before B2B payments are truly global and digital.