Small Businesses Willing to Pay Premium to Eliminate AP/AR Hassles

Small to mid-sized businesses (SMBs) encounter numerous pain points when making and receiving business-to-business (B2B) payments. Many are stuck in the past, with 20% relying on checks and 23% relying on regular ACH as their go-to methods of sending payments, and there is significant asymmetry in the preferences of buyers and suppliers.

PYMNTS’ research reveals that SMB buyers and suppliers are fed up with inefficient and outdated accounts payable (AP) and accounts receivable (AR) platforms. Many are interested in using — and even paying for — an all-in-one solution.

In the AP/AR Quick-Start Guide: Reducing B2B Payments Friction For SMBs, a PYMNTS and Plastiq collaboration, we surveyed 500 SMBs and 100 billing and collections executives to determine the state of play for the B2B payments space and gauge the appetite of SMBs for an all-in-one platform that can address many of their AP/AR headaches. The guide takes a deep look at the pain points encountered by SMBs both in sending and receiving B2B payments and whether these businesses are willing to pay for a more efficient alternative.

Key findings from the report include:

• Nearly one-third of SMBs would be interested in using an all-in-one payment platform to receive payments.

Companies earning between $20 million and $50 million in annual revenue show significantly stronger interest than smaller companies, as just 22% of those with less than $1 million in annual revenues are interested.

• Businesses generating less than $1 million in annual revenue are more likely to use credit and purchasing cards and instant or real-time payments for their AP commitments.

SMBs in this revenue bracket are more likely to settle outstanding payments with credit and purchasing cards and instant or real-time payments than larger companies.

• Poor platform flexibility of traditional accounts receivable systems is a top pain point for SMBs receiving B2B payments.

The lack of integration with other systems is a leading point of friction that 39% of SMBs face when receiving B2B payments.

To learn more about how an all-in-one payment platform can streamline payments for SMBs, download the report.