Panel: The Hidden Cost of B2B Payments Is Manual Work, Not Fees

Watch more: BILL Webinar | Mary Kay Bowman and Scott Hess

The cost of getting paid in B2B commerce is often hiding in plain sight. Finance teams continue to measure payment cost through the most visible inputs: transaction fees, bank charges, interchange, processing costs and the price of specific rails. But for many suppliers and small to medium-sized businesses (SMBs), the more consequential expense begins after the payment is initiated.

Mary Kay Bowman, EVP of payments and financial services at BILL, described that reality as an “overarching tax of doing business” in a conversation with Scott Hess, director of treasury at Cintas, hosted by PYMNTS.

Businesses, Bowman said, often spend too much time calculating the direct cost of a payment method while overlooking the compounding costs created by manual work. Paper checks remain the clearest example of the contradiction. They persist because they are familiar, universal and often perceived as easy. But from a finance operations perspective, they remain difficult to automate fully because the exceptions still have to be managed by people.

“One way we look at it is the exception taxes,” Bowman said. “They’re often overlooked.”

The issue is no longer simply whether a business can move money electronically. It is whether the payment, approval, remittance data, reconciliation and cash application can operate as one connected workflow.

Businesses Take Their Stand in the Fight Against the Cost of Doing Business

The persistence of payment friction reflects a mismatch between the buyer’s and supplier’s view of the same transaction. A payer may consider a payment complete once money leaves the account. A supplier may not consider it complete until the payment is identified, matched to the right invoice and applied to the books. That gap can make a payment method that looks inexpensive on paper more costly in practice.

“You might have one payment method that is having a low direct fee, but it has a high exception rate,” Bowman said. “ACH sometimes gets into that category. They might have a harder time reconciling, so it may stretch your reconciliation out from a few minutes to a few hours to a few days.”

The problem compounds from there. Each delay creates follow-up work. Each missing remittance detail creates uncertainty.

“That’s not only labor cost, but that’s also cost of having your capital tied up because it’s not applied to your books,” Bowman added. “Checks are still the stubborn problem in the payments networks. There’s still a lot of paper out there.”

For large enterprises, the buyer-supplier payment problem is not theoretical. It is operationally dense, especially when a company must serve customers and vendors across geographies, business units, payment types and relationship models.

Enterprise Scale Makes B2B Payment Friction More Expensive

Hess described that operational complexity from the perspective of a company operating at significant scale. Cintas, he said, operates in the U.S. and Canada, has more than 48,000 employees, multiple banking partners, more than a million customers and more than 40,000 vendors.

“We’re in the position of having to balance all of these elements to maintain an effective and pleasant customer experience,” Hess said. At the same time, he added, the company must manage “a control environment,” policies and fraud prevention across both accounts receivable and accounts payable.

That middle position gives treasury visibility, but it also forces trade-offs. A process that works efficiently for the enterprise may create friction for customers or suppliers. A workflow that supports a decentralized field relationship may complicate centralized controls. A new payment strategy may improve customer experience while introducing reconciliation, policy or fraud-management considerations.

“We see the money coming in, we see the money going out,” Hess said. “This payment ecosystem that we have creates both benefit and challenge.”

Visibility Is Becoming the Real Payment Advantage

For SMBs, payment visibility is especially valuable because many lack the treasury infrastructure of larger enterprises. They need to know when money is moving, whether a supplier has received it and whether the transaction has been properly reconciled.

Bowman said SMBs often see one side of a transaction while their suppliers see another. That creates uncertainty, especially when small-dollar transactions occur across high volumes of customers, field offices and payment channels.

“It seems like you’re just doing one or two,” Bowman said of manual exceptions. “But when you add them up across all of the customers, across all of the field offices, they really create an operational drain.”

That drain now defines the new payments agenda. Digitization matters, but only if it reduces fragmentation. Speed matters, but only if the payment arrives with the data needed to reconcile it. Cost matters, but only if lower transaction fees do not create higher back-office expense.

The fight against the cost of doing business is therefore becoming a fight against disconnected money movement. In B2B payments, the hidden cost is not just what companies pay to move money. It is what they spend figuring out where the money went.

Embedded Payments Shift the Operating Model

The next stage of B2B payments modernization is not simply replacing checks with digital alternatives. It is embedding payments into the finance workflows where invoices, approvals, supplier data and remittance information already live.

Bowman called embedded payments “one of the biggest shifts” in software and FinTech because they move payments from a final step into an orchestrated process.

“Embedding payment flows and payments directly into core workflows completely shifts the paradigm,” she said, adding that the real opportunity is “true orchestration where you connect that workflow to the money flow.”

That connection matters because payment data and payment execution have historically been separated. Remittance information may sit in one workflow, payment instructions in another and reconciliation in a third. The result is a finance team forced to stitch together the transaction after it has already happened.

Bowman said embedded payments can bring automated routing, remittance capture and reconciliation into a single experience. “The remittance is already sitting in the workflow, it’s also sitting in the payment,” she said. “Now, we can bring those together and have the machine do the work.”

Watch the full PYMNTS TV interview with BILL EVP of Payments and Financial Services Mary Kay Bowman and Cintas Director of Treasury Scott Hess to hear more about:

Why the real cost of B2B payments starts after money moves. Bowman argues that businesses often focus on direct fees while overlooking the “exception taxes” created by manual work, missing remittance data, delayed reconciliation and tied-up capital.

How enterprise scale turns payment friction into operating cost. Hess says companies like Cintas must balance customer experience, supplier needs, banking relationships, controls and fraud prevention across millions of transactions, making even small exceptions expensive at scale.

Where embedded payments can change the finance workflow. Connecting invoices, approvals, remittance data, payment execution and reconciliation inside one workflow can help businesses reduce fragmentation and let machines handle the work finance teams still stitch together manually.