The world of regular payments frequently leads the business-to-business (B2B) payments landscape in leveraging innovation.
That’s why, with the news last week (May 15) that Visa is launching a suite of disruptive new products and services built for the entire payments ecosystem, forward-thinking enterprises are already starting to wonder what the advances could mean — both right now and down the line — within the B2B payments landscape.
After all, it is becoming increasingly true that business professionals, who are also consumers, now expect the same level of convenience, speed and ease-of-use in their professional transactions as they do in their personal ones. This includes things like intuitive interfaces, mobile accessibility, and real-time processing, as well as security and even personalized offers.
And after suffering through decades of difficulties and delays when transacting with each other, businesses on both sides of the B2B relationship are ready for a better approach to B2B payments — which make up the lion’s share of the global economy and represent over $100 trillion in annual volume, all despite relying upon infrastructure and technologies that are well past their “best by” date.
Visa’s seven new products, which are focused at a high level on digital payments and card optionality, payment security, modern payment rails, and personalization, each represent capabilities that could, and one day might, end up transforming the B2B payments landscape.
Read more: B2B Virtual Cards Move Buyer-Supplier Relationships From Manual to Meaningful
Fortunately for commercial buyers and suppliers looking to upgrade their B2B payment workflows, payments capabilities have never been better, or more accessible. That’s because newer technology is typically easier to implement and augment than historical solutions, meaning that the adoption curve for B2B payment advances is shrinking.
“The next horizon over the next five years is truly in B2B payments,” Sovos Chief Technology Officer Eric Lefebvre told PYMNTS.
“This is the calm before the storm. The next five to six years [are] going to be a massive change agenda. … The payment methods, the compliance environment, ERP [integration], the level of sophistication around automation — that’s where payments modernization will have an impact,” he added.
Echoing that sentiment, Jill Capicchioni, product director, payments at NCR Voyix, told PYMNTS, “There’s a huge opportunity for small businesses and mid-size businesses, and even large businesses, to continue to embrace moving away from checks and adopting other payment methods.”
And Visa’s new products and services that aim to transform the payment card experience hold rich clues for businesses looking to both capture and provide a better B2B payments journey.
That’s because a good user experience can help create a more profitable and loyal B2B partner base, and due to their digital interactions outside of the B2B experience, both buyers and suppliers today have come to expect more than what paper checks or ACH wires have traditionally been able to offer.
See also: 3 Ways Legacy B2B Challenges Are Shaping Tomorrow’s Biggest Opportunities
“For merchants, however you want to be paid and how you want to receive money, we’re going to support you. … The underlying principle is choice.” Mark Nelsen, senior vice president and global head of consumer payments at Visa, told PYMNTS in an exclusive discussion about last week’s news.
And offering multiple payment options while ensuring a smooth payment experience is a central contributor to customer satisfaction, and satisfied customers are more likely to return and recommend a business to others, fostering loyalty and generating repeat business.
This holds true across B2B payments as well, where virtual cards are becoming a prominent payment mechanism.
“We think virtual cards are really at a tipping point,” Paul Christensen, founder and CEO of Previse, told PYMNTS, highlighting that as the value proposition around their use changes, bigger suppliers and more businesses have softened their stance and become willing to accept virtual cards for B2B payments.
“There are trillions of dollars that are going to move to virtual cards in the next two, three, four, five years,” Christensen added. “It is 2024, and we are still licking stamps and putting checks in the mail — that’s mad.”
“The companies that aren’t embracing virtual cards or B2B payments innovations will be the ones that fall behind,” ConnexPay founder and CEO Bob Kaufman told PYMNTS in March. “The suppliers that are not as flexible and willing to embrace these new forms of payments are going to lose business, while the buyers who are not using them are losing revenue, which results in them not being as competitive in their space.”
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