Business payment solutions provider BillingTree has experienced a flurry of progress since welcoming its new CEO Edz Sturans only six months ago. In pushing for B2B adoption of updated, streamlined payment collections services, BillingTree reports stronger integration of some of its most cutting-edge technologies to simplify buyer/supplier financial relations, including data feed and negotiation tools. While only having less than a year at the firm under his belt, Sturans is in a unique position to reflect with PYMNTS.com on the state of innovation in B2B payments, and where the space needs to make more headway.
PYMNTS: The B2B payments space has been notoriously slow at adapting new payments technologies. Why do you believe this is so, and how has BillingTree facilitated that adoption?
ES: The B2B space has continued to rely heavily on the paper invoice and a net 30-day payment term, which allows for larger balances to float for 30 days or greater. This has been a key reason for the slow adoption of electronic payments in the B2B arena. BillingTree services many collection agencies and they collect on past due B2B balances – these agencies have adopted our payment technology and have significantly expedited payments, especially ACH, for really large balances. Other technologies adopted by these firms include payment portals which allow AP departments to settle a balance online.
PYMNTS: You offer solutions for an array of customers, including lenders and retailers. But what are some key differences – if any – you believe exist in the demands for B2B payments solutions compared with other arenas, like B2C and retail payments solutions?
ES: Consumers are driving the mobile payment revolution, not B2B. Since AR and AP departments still rely on desktops and enterprise software, servicing them with more traditional Web services is still the norm. B2C requires responsive design tailored to consumer preferences. With the retail sector seeing a swell in payment methods – think Apple Pay, Bitcoin and Google Wallet – consumers are faced with a wide variety of ways to pay for their goods. So when dealing with a consumer, it really benefits to offer a full array of "omnichannel" payment options – including increasingly popular automated and digital options like IVR, Virtual Negotiation and online recurring billing.
PYMNTS: You revealed in January that your Virtual Negotiation technology reduced delinquencies by 40 percent for National Recovery Solutions. Tell us a bit about that technology and the importance of reducing late and delinquent payments in the B2B space.
ES: Our Collection Agency clients often utilize Virtual Agent/Negotiation systems we offer to allow consumers to negotiate a balance settlement and payment plan without speaking to an agent. Through an online gateway, the consumer can offer terms for a repayments plan. The technology then uses algorithms to calculate the best probable scenario for resolving an outstanding balance and sends a counteroffer back to the consumer. Vendors set their own parameters for loan repayments which the negotiator stays within – the consumer then works around this and settles on a payment plan that suits their circumstances. This means they have a higher level of control over their outstanding bill payments and our customers have seen a dramatic reduction in delinquencies as a result. Of course this is cost-effective as agent time can be used elsewhere.
In B2B – often discounts are applied for early payment which is better than chasing past due payments when a client will utilize. However, in B2B, if a bill goes past 90 days it becomes increasingly more difficult to collect on, and therefore more important to offer the path of least resistance to collect payment if/when the client decides to pay. Even offering a small percentage discount of 10 percent or installment payments for larger balances in B2B helps the likelihood of the client paying.
PYMNTS: Where do you see the future of B2B payments headed? What technologies would BillingTree like to see buyers and suppliers adopt to facilitate payments between each other?
ES: There have been many efforts to automate purchase orders and corporate P-cards, to some degree of success. Because most business is in the SMB space, I think corporate debit or credit cards have the greater chance for adoption in the typical organization. They key for these is setting controls on who can use those and how they are reconciled. As more SMB B2B service providers realize the advantages to accepting card and ACH payments outweigh the costs, including real-time authorizations, fewer NSF hassles or trips to the bank to deposit checks – the adoption will scale. The technology needed to support this includes corporate Web payment portals and a shift to electronic bill presentment which has been more widely adopted already without the payment component. As B2B customers increasingly adopt modernized buying practices – and new technologies gain traction in B2C payments – new payment options may cross over into B2B in the not-too-distant future. We are certainly seeing B2B companies realizing the business benefits of offering more payment options.
PYMNTS: After only six months, you have already expanded BillingTree with new partnerships and new payments technology offerings. Take us through the next six months for BillingTree, both in general and in the B2B payments solutions realm.
ES: We have some exciting technology development underway that will be coming out in the next six months plus we’ve recently rolled out a proprietary data management tool that allows disparate systems to connect and securely communicate payment and account information. We'll also soon be announcing the results of our third annual industry-leading survey around Collection Agency operations and technology – expect a top-line report soon. We’re excited to see our technology help innovate the B2B space and as we continue to partner and integrate in other verticals like auto finance, banks/credit unions and health care – it’s sure to expose our service to both B2C and B2B companies.
Chief Executive Officer, President at BillingTree
Edz (pronounced “edge”) Sturans joined BillingTree as CEO and President in September 2014, bringing a proven track record of leadership and results. Edz has been a visionary in the Accounts Receivables Management (ARM) Industry since 1998 and has extensive experience in business development and customer relationship management. Prior to joining BillingTree, Edz was President of CR Software where he successfully grew the business by over 450 percent and facilitated the company’s 2012 sale to FICO®, where he most recently served as VP of Global Product Services. To follow Edz on Twitter search @BTreeCEO.