B2B Payments

Study: Small Businesses Want More B2B e-Payments, But Lack The Know-How To Make It Happen

While 90 percent of small businesses have a presence online, only 10 percent can leverage it into sales.  Moreover, while small and midsize business owners say they think about moving their account receivable, accounts payable and payroll functions into an electronic instead of paper-based system, a majority report they do not know where to start.

These are some of the many finding’s in MasterCard’s new Merchant Scope survey that demonstrate that among SMBs, the will for ePayments is there, it’s just figuring out the how to get it done that presents a problem.

“Advances in technology – including payments – have often presented an opportunity for small businesses to level the playing field,” Theodore Iacobuzio, MasterCard vice president of global insights, said in a released statement. “But as consumers take advantage of emerging technologies like mobile to access deals and rewards, businesses of all sizes find themselves needing to create an ‘always on,’ omni-channel presence or mobile app to attract new and repeat customers. Many small businesses, in particular, find this to be challenging.”

The global picture also shows highly heterogeneous adoption patterns among small business owners.  In South America, Brazil is leading the pack of the tech-centered new economy where-in business are more fully adopting automated, electronic and data enhanced solutions to business problems. Some 92 percent of Brazilian merchants consider technology vital to running their businesses, a particularly strong showing, considering that international finance hub Germany has SMB owners who are decidedly less excited about the tech-centered payments future.  Only 42 percent of German merchants believe technology is or will be a vital tool to the day to day operations of their business.

Where business are managing operations from is also changing, albeit slowly depending on the function.  On average, 56 percent of Canadian and Brazilian merchants use smartphones to assist in running their businesses, while only about 32 percent of German and South African merchants do the same.

Adoption Varies By Industry

Among small business sectors, restaurants are the leaders in both B2C and B2B adoption of payments enhancing tech.  Hospitality and Restaurants according to the study found to invest a larger portion of their revenue on both  back-office system and consumer-facing technology – 11.8 percent  and 8.1 percent respectively.  Additionally, more than half, 51 percent,  of restaurants are using software for inventory management while hospitality businesses are the most enterprise type to have an eCommerce website to attract travelers and to utilize e-mail marketing.

“The barriers of cost and a lack of expertise are holding back small businesses from unlocking their true potential.  This is important, not only for merchants, but also for the technology providers, banks and governments who support them,” said Iacobuzio. “Now that we better understand the obstacles small businesses are facing, we can work with all of the players in this ecosystem to tailor solutions and technologies to help them be more successful and better engines of economic growth.”


New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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