CareCredit - Women's Health April 2024

Buyer-Supplier Relationships Are Being Reshaped in a Crucible of Convenience

business finance people

Change can happen slowly, and then suddenly all at once. 

And the B2B payments space is increasingly moving away from the incremental drip of change toward the full-on sprint of modernization. 

That’s because B2B payments are no longer the staid and traditional sector money movement vehicles they once were. The digital revolution, fueled by advancements in technology and changing consumer behavior, is sweeping through the financial world, and B2B payments are no exception. 

Of course, the technical feasibility of change matters little if there is no adoption. That’s why 2024 is shaping up to be the year when B2B relationships are re-forged within the crucible of digital convenience. 

As for the fire heating things up? Ideally, it is made up of the mountain of paper checks that have been keeping B2B payments stuck in the confines of a prior century’s workflows. 

By moving away from legacy systems and embracing modern payment platforms, organizations can enhance their overall customer experience and achieve cost savings.

After all, business innovations typically follow customer expectations — and today’s B2B players are coming to the table with a laundry list of expectations. Chief among them are convenience, optionality, and interoperability.

Read moreThe Trickledown Consumerization of B2B Payments Helps Firms Win Business

Shaping the Future of B2B Payments

The lessons learned from revolutionizing B2C payments must now be applied to the world of business transactions. 

“There’s a lot of change going on in the industry,” Kelli Svymbersky, vice president of payment at CCC, told PYMNTS. “We are all expecting that instant payment experience that we have in our personal lives’ across business transactions … the payments experience is [becoming] a part of the organization’s brand.”

“If we look at organizations that have legacy platforms that have been in place for some time, from a purely payment standpoint, that infrastructure relies on outdated processes and is not as secure,” she added, explaining that few payment methods are as susceptible to abuse as the paper check. 

Across B2B payments, a new level of convenience is increasingly becoming the expectation rather than the exception. 

Businesses are demanding the same frictionless experience they enjoy in their personal transactions. This shift is not just about speed but also about user-friendly interfaces, intuitive design and responsive customer support that make commercial transactions as effortless as ordering a cup of coffee.

Optionality is the second theme driving change in B2B payments. Traditionally, B2B transactions were confined to a narrow set of channels and methods — but the modern business ecosystem demands flexibility. 

“Payments is experiencing kind of a second renaissance, if you will, with the rise of alternative payment options such as buy now, pay later, wallets, and bank payments. … Businesses are spending a huge amount of time and money on UX [user experience] improvement, figuring out how they can improve the customer experience,” Andrew Gleiser, CRO at FinTech platform Aeropay, told PYMNTS. 

Just as consumers have a variety of payment options at their disposal, businesses, too, should be empowered to choose the methods that best suit their needs. This means embracing a multitude of payment channels to cater to the unique preferences of different businesses while enhancing the overall efficiency and adaptability of the B2B payments ecosystem.

Read more: Buy, Build or Partner? The Dilemma in B2B Payment Modernization

Addressing B2B Challenges

B2B payment advances are reshaping the ecosystem for commercial players by streamlining processes, enhancing decision-making, and offering unprecedented insights into financial transactions.

“The market changes over the past few years have really accelerated the adoption of digitized B2B payments, which in turn has accelerated the innovation in the industry,” Chris Lolli, vice president and general manager of B2B product, partner and client management, at American Express, told PYMNTS.

In the interconnected world we live in, businesses operate within complex networks, collaborating with partners, suppliers and customers globally. The seamless flow of funds across these networks is critical.

The successful B2B payments platform of the future will be one that can integrate smoothly with a myriad of systems, facilitating instantaneous transactions across borders and industries.

But to get there, they’ll first need to address the ongoing challenge — and inertia — of monolithic legacy systems. 

“We see the most inertia with very large clients, who have deep integrations into legacy payments infrastructure,” Shane Conway, executive general manager of transaction banking, enterprise payments and asset servicing at National Australia Bank, told PYMNTS. 

“On the technology side, if you’re in a place now where your in-house system looks like it did 20 or 30 years ago, this is a chance to make a huge leap forward,” Ben Lamm, chief operating officer at Capital One Trade Credit, told PYMNTS in August.

But contrary to what some firms may think, modernizing B2B payment processes is not limited solely to digitally sophisticated businesses with highly advanced tech stacks.

Payment platforms are becoming more accessible and increasingly offer easier integration, regardless of an organization’s technical maturity — meaning the time has never been better to implement them.