B2B Payments

Why FLEETCOR Bought Nvoicepay

The B2B payments landscape is giant, so its problems and points of friction are behemoths, too. While the industry has opened doors to many new FinTech firms that tackle individual pain points of corporate payments, large-scale problems need large-scale solutions.

That means solving B2B payment problems must be about more than tackling manual processes. After all, digitizing a complex process may take paper out of the equation, but still leaves all the complexity.

For corporate and fuel payments company FLEETCOR, collaboration is an essential strategy to addressing corporate payment challenges at scale. Most recently, the company announced the acquisition of Nvoicepay, an accounts payable (AP) automation firm that FLEETCOR Group President of Commercial Payments Kurt Adams said is closely aligned with its own vision for solving B2B payment pain points. That effort, he explained to PYMNTS’ Karen Webster, involves far more than digitizing a payment for a corporate buyer.

A Collaborative Approach

The Nvoicepay acquisition means FLEETCOR will expand its existing card payment processing capabilities to include automated accounts payable transactions for a range of payment methods, with a broader focus on modernizing the AP process overall. Following its past partnerships with, and acquisitions of, a host of FinTech firms and payment networks (including AvidXchange, Bill.com, Comdata and Cambridge Global Payments), Adams said FLEETCOR is focused on collaboration opportunities as they come — with one qualification: They must provide large-scale solutions for broad problems.

“What we’re looking for is a place where an AP department can look at something in a much more simplified and integrated view, and execute their payments,” he said, adding that businesses must be able to make their payments quickly, online and globally (if necessary), all in a solution that integrates with the rest of the enterprise.

FLEETCOR and its collaborators may be positioning themselves in the accounts payable department, but, according to Adams, to make a real dent in B2B payments progress, solutions must find themselves on the accounts receivable side of the equation, too.

“I do believe the supplier is the single biggest opportunity — and biggest risk — to scaling,” said Adams. “Yet, this is primarily a buyer-focused market.”

Target The Supplier

One characteristic of Nvoicepay that made it such an attractive target to FLEETCOR was its focus on the supplier when looking to digitize and overhaul corporate payments.

In the area of commercial and virtual cards, for instance, connecting corporate buyers with a card solution they can integrate into their AP processes is nice. However, it doesn’t address one of the most significant barriers to commercial card adoption: supplier acceptance. By bringing Nvoicepay into the fold, FLEETCOR can expand its supplier acceptance and onboarding services to a range of payment tools, including ACH.

Operating on both ends of the transaction enables solution providers to increase the value proposition for vendors, which often shy away from taking the fees associated with card acceptance — meaning companies must manage the operational friction burdens, as well as the financial costs, of digital payment acceptance. Addressing that friction increases the value of accepting a card or other digital payment, Adams noted.

There is also the issue of payment speed and predictability that exemplifies how simply digitizing AP transactions isn’t enough to improve the B2B payments landscape. Even if a vendor accepts a card payment, if that payment is still unexpectedly late, the value of digital payment acceptance decreases significantly. The “value of certainty,” he said, “doesn’t go as noticed in the market,” but can be just as big of a factor for improving B2B payments as reducing paper checks.

Beyond The Payment

Issues like payment speed, rail and technology are front-and-center in B2B payments innovation, but Adams emphasized that solution providers must take a step back to tackle broader factors adding friction to the space.

Increasingly, that conversation includes the topic of data, and the ability for both buyers and suppliers to obtain the information they need to settle, reconcile and analyze. Addressing issues of bottlenecks and workflow inefficiencies is another area of corporate payments in need of improvement, Adams noted.

“The more seamless the workflow becomes to the organization, the more natural it becomes not only for the payments themselves, but how they see payment data, payment flow, how payments settle,” he said. “It’s very important, from our standpoint, to be in that process.”

This is especially important for large enterprises with high volumes of cross-border transactions, hundreds of ERP systems and platforms, and thousands of vendors and bank accounts — presenting endless opportunities for inefficiencies that won’t be addressed by simply nixing paper.

According to Adams, as corporations begin to tackle their B2B payment inefficiencies, they’re also having new conversations about what it means to solve these problems. Even as organizations move forward in their digitization journeys, they’re realizing that operations are shifting from being manually complex to digitally complex, leading corporate leaders to turn their attention on the issue of simplifying, not just digitizing.

“We’re trying to bring flexibility to the buyer and supplier,” he said, “not only in how they make payments, but also receive payments — the timing and quality of payments in how they make and receive them. That’s the most simplistic form of how we’re looking at the world.”


New PYMNTS Report: The CFO’s Guide To Digitizing B2B Payments – August 2020 

The CFO’s Guide To Digitizing B2B Payments, a PYMNTS and Comdata collaboration, examines how companies are updating their AP approaches to protect their cash flows, support their vendors and enable their financial departments to operate remotely.