Businesses have spent years investing in systems designed to determine whether a payment is legitimate. Fewer have invested in ensuring that a legitimate payment actually arrives.
Just 13% of firms use payment guarantees, despite the PYMNTS Intelligence report “The Payment Guarantee Gap: Why Adoption Lags Despite Perceived Value,” a collaboration with Plaid, finding in October that 76% of firms expected a moderate or significant positive impact on their business outcomes from a payment guarantee, and 95% expected at least some positive impact, with none predicting a negative one.
Implementing a new financial technology can introduce costs and complexity before its benefits become measurable, the report showed. Integration concerns were cited by 74% of firms, while 64% questioned guarantee fees relative to expected benefits. Another 59% reported an unclear return on investment.
Many firms have yet to establish a viable baseline for comparison of that ROI. A company that measures payment failures only through direct write-offs may underestimate their full economic impact. Conversely, a company with low failure rates and inexpensive recovery processes may find guarantees difficult to justify.
That makes targeted deployment potentially more attractive than universal coverage, particularly for payment flows where failures create disproportionate operational costs.
The Difference Between Preventing Fraud and Guaranteeing Revenue
The economic opportunity is not simply fewer failed payments. It is reducing the operational burden that payment uncertainty creates throughout the business. A guarantee fee might appear expensive when compared exclusively with historical payment losses. But that comparison can omit the operating costs associated with collecting money that was already owed.
When incoming payments become more predictable, treasury teams can potentially make more reliable decisions about liquidity buffers, cash deployment and short-term funding requirements. The report found that 78% of respondents identified improved cash flow predictability as a factor in calculating the ROI from better payment reliability, while 75% cited reduced revenue loss.
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There’s always the chance that companies may be measuring payment performance too narrowly. According to the research, 73% of firms cited confidence in their existing internal controls as a reason for not adopting guarantees. Yet among those companies, 44% could not detect suspected fraudulent payments in real time or within minutes.
Across the full sample set for the report, 6% of transactions flagged or declined by fraud controls subsequently proved legitimate.
The adoption gap may also not remain this wide. The report revealed that 48% of firms expected to adopt or expand payment guarantees within two years.
Interest was especially pronounced among companies whose fraud controls were already highly adapted for real-time, irrevocable payments. Among these firms, 72% anticipated adopting or expanding guarantees, compared with 22% of firms with the least-adapted controls.
The relationship suggests that payment guarantees may become more attractive as companies modernize their payment infrastructure, rather than serving as a substitute for modernization. The objective is no longer exclusively to move money faster or screen transactions more effectively. It is increasingly to establish how much certainty a business can attach to the money it expects to receive.
In a financial environment where payment failures can ripple through revenue, liquidity and customer relationships, certainty itself may become a measurable competitive advantage.
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