“Companies are being pushed to innovate,” he said. “They have the technologies they need to innovate, and they have a lot more market adoption when they do innovate.”
For many enterprises, there are new, digitally-driven expectations firmly in place that equate to table stakes when it comes to B2B interactions.
First and foremost among these expectations is embedded finance.
As Oudghiri noted to PYMNTS, “You cannot be a large, vertical B2B SaaS without bringing in payments.” For the providers themselves, he added, the goal is to “abstract away the complexity” for their own merchant and enterprise clients and become trusted, day-to-day partners.
“They’ll be thinking about completing their product sets,” he said of the vertical Software-as-a-Service firms, “and they are being holistic about their solutions. That’s the growth path right now.”
For horizontal business models expanding into new markets, the focus is on efficiency and re-architecting their technology stacks to do more with less in an environment of higher-for-longer interest rates.
The opportunity is there for innovation in the B2B space, said Oudghiri. Some marquee names in financial services have exited strategic payments business lines. There’s been what he termed a “flight to quality on core payments infrastructure,” as regulatory frameworks and compliance mandates are consistently shifting across the globe.
For forward-thinking firms, consolidation may be a key strategy to sharpen their efforts to craft a holistic set of products and features for businesses. (Squarespace, by way of example, struck a pact earlier this year to buy Google Domains.)
No matter the go-to-market approach, said Oudghiri, real-time payments will figure into the discussion of what’s next and how faster payments might change commercial commerce.
“It may feel like real-time payments will be a game changer in the United States, but in reality, it’s about keeping up with consumer demands,” he said.
Real-time functionality has already taken root in various economies around the world, and as Oudghiri said, merchants will need to pivot to meet that demand.
With real-time payments, “there’s plenty of opportunity for fraud,” he said. Against that backdrop, the best lines of defense come with harnessing data.
“In the payments industry, we’ve had a very data-rich environment, but we’ve operated in an insight-poor environment,” he said.
Real-time transactions leave little room for adjudication, and the window of time to examine the transactions themselves is an ever-shrinking one, he said. Artificial intelligence and machine learning can and will help improve risk controls and all manner of back-end operations, ranging from loan servicing to customer support.
As 2024 dawns and through the years ahead, he said that digital innovations and AI will help streamline and embed finance into new use cases and business models. Enigma, for its part, has powered acquisition onboarding, working capital and lending products. Informed by data across its network, it connects hundreds of far-flung figures to provide insight about businesses to its customers that stretches beyond the information typically provided by the credit bureaus.
Advanced databases and data flows provide granular insight into business’s risk and compliance standing across the globe, he said. Enigma also manages signals derived from transactions and a consortium with the top issuers in the country to gain real-time risk insights.
“Servicing and dispute management and receipt collection, and all of these little manual things that we’ve now outsourced to call centers and people looking things up very manually in a rigid way — there’s a huge opportunity for that experience to be much richer for merchants,” he said.
And, as Oudghiri told PYMNTS, with the distribution power of the internet, “we are getting scaled from an infrastructure perspective in payments and risk management in ways that we haven’t seen before. I find that super exciting.”
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