ConnexPay CEO: Digital Payments Adoption Defines B2B Winners and Losers in 2024

Teamwork makes the dream work — particularly within B2B payments.

That’s because, among other benefits, partnerships and collaboration are essential for fostering innovation, customer satisfaction, adaptability to market changes and above all, optionality, for commercial players.

“When companies take a one-size-fits-all approach [to payments], it tends to be limiting,” Bob Kaufman, founder and CEO at ConnexPay, told PYMNTS.

He noted that the travel industry, which ConnexPay serves, is comprised of over 400 different airlines worldwide, each with specific payment needs that make it crucial to provide variety of payment options.

“Large travel providers across the globe want to be able to have multitude of options for paying suppliers … there are different needs in terms of how those payments should be made,” Kaufman said.

And in order to provide that increasingly expected optionality around payments with product-level innovations, firms are turning to payment advances that include virtual cards, which have gained significant traction in the B2B space as a secure and efficient payment solution.

See also: ConnexPay Adds Variable-Rate Virtual Card to B2B Payment Capabilities

How Virtual Cards Boost B2B Relationships and Expedite Growth

As businesses continue to embrace digital transformation, virtual cards provide a modern, efficient, and adaptable solution for managing B2B transactions.

That’s why, Kaufman explained, as part of ConnexPay Exclusives, a category of payment capabilities designed to increase supplier acceptance and boost profitability, ConnexPay has launched the ConnexPay UATP (Universal Air Travel Plan) card — a virtual card that ConnexPay clients can use to pay travel suppliers, such as airlines and rail carriers, who are members of the UATP network.

UATP is a global payment network which has been around for over 80 years and was originally created to facilitate payments between airlines for shared services — before Visa and Mastercard existed as card options.

“Within the travel space we can ensure 100% acceptance on a card regardless of who you’re paying. And almost nobody else can say that,” said Kaufman, noting that travel businesses, including travel agencies, tour operators, and hotel consolidators, often have strategic alliances with airlines, which require specific payment arrangements. The virtual card solution allows for automated selection of the most appropriate card product based on the supplier being paid. This flexibility helps clients reduce fees and streamline their reconciliation processes.

Virtual cards, in general, offer several benefits, including enhanced security, faster payments, and improved reconciliation. They have been instrumental in reducing fraud and protecting personal card information.

However, Kaufman highlighted the importance of offering a variety of card products to cater to different payment requirements.

“A lot of the big banks, some of the other virtual card providers, they say they offer virtual cards, but the reality is it’s one type. What does that mean? That means that at one interchange rate tied to it, it’s a commercial credit card or commercial prepaid card. Within many B2B payment use cases, if you’re making a hundred thousand dollars payment nobody wants to pay 2.65% on a hundred thousand dollars payment,” said Kaufman.

A Virtual Card for Every B2B Need

Virtual card solutions are scalable, making them suitable for businesses of all sizes. Whether a small startup or a large enterprise, organizations can adopt virtual cards to meet their evolving payment needs.

ConnexPay currently offers over 60 different types of card products, ranging from zero interchange cards to those with higher interchange rates. The virtual card with UATP is another tool in ConnexPay’s arsenal, allowing clients to select the most suitable payment option based on their relationship with suppliers.

Looking ahead, Kaufman expects continued growth in the virtual card industry, driven by the need for enhanced security and the potential for revenue opportunities such as rebates or cash back. He also envisions more innovation in the B2B payment space, with businesses demanding the same ease and flexibility of payment options available in the consumer space.

“The companies that aren’t embracing virtual cards or B2B payments innovations will be the ones that fall behind. 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,” he said.

While there may be factors that could slow down adoption, such as a lack of awareness or resistance to change, Kaufman believes that companies that do not embrace virtual cards may fall behind in the competitive landscape. He also emphasizes the importance of dispute mechanisms provided by virtual cards, which could become more relevant in times of economic downturn or when companies go out of business.