Gaps in communication and connectivity between corporate buyers and suppliers can quickly lead to breakdowns in crucial business relationships. According to new research, part of that problem can be traced back to suppliers’ lack of knowledge of payment behaviors, especially when it comes to the commercial card.
Mercator Advisory Group announced its latest study on Tuesday (Dec. 15), which came to the conclusion that commercial card issuers should help suppliers take the steps they need to accept payments through this technology. Doing so, researchers said, will benefit the entirety of the supply chain.
“There is a tremendous upside to card scheme acceptance, for which banks and buyers hold the keys,” stated Mercator Commercial and Enterprise Payments Advisory Service Director Richard Hall. Hall also served as principal author of the research report.
According to Mercator, the benefits of supplier acceptance of commercial card payments are well-known, including strengthened relationships with buyers and the ability to more adequately manage working capital.
Despite these benefits, however, researchers said that suppliers struggle to accept commercial cards and are often reluctant to do so due to a “lack of knowledge” of how commercial cards can actually help reduce their costs.
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While suppliers can benefit financially from accepting commercial cards, issuing banks will see greater processing volumes of these products, and corporate buyers will see less friction in settling their outstanding invoices.
The research report is entitled “Driving Up the Value of Commercial Card Acceptance for Suppliers.”