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B2B Payments’ Digitization: What to Expect in 2022 & Beyond

Boaz Gam

Boaz Gam


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4 min
Article content
  1. What Is the Current State of B2B Payments?
  2. Challenges of Paper Checks
  3. The Benefits of Digitizing B2B Transactions
  4. B2B Payments’ Digitization in 2022 and Beyond

Is B2B Payments’ Digitization the Next Trend?

Historically, B2C payments have always been digitized sooner than B2B transactions. Now that the world is recovering from the pandemic, this gap is becoming even more prominent. Due to this, 2022 is marked by a transformation in B2B payments characterized by a strengthening focus on meeting the expectations of suppliers and merchants.

Read on to learn more about the digitization of B2B transactions in the near future and the payment trends associated with it.

What Is the Current State of B2B Payments?

Is B2B Payments’ Digitization the Next Trend?

Despite the fact that we are living in a digital era, there’s still a lot of paperwork involved in B2B transactions. For instance, paper checks still account for over half of the overall B2B transaction value, even though the number of organizations that use them is gradually decreasing.

It’s also common for businesses to send out paper invoices or to print out the emailed ones for them to be annotated and registered into an ERP system. When it comes to the payment experience itself, it is also often manual, inefficient, and lacking security.

Challenges of Paper Checks

Is B2B Payments’ Digitization the Next Trend?

Despite remaining a common B2B payment method, paper checks are associated with a variety of downsides, including:

  • High costs. Paper checks cannot be considered cost-effective, as it costs approximately $4-$20 to process one. Besides, you should also count in the associated taxes and the payment for the time your employees spend processing such transactions manually.
  • Mail delays. Commercial mail deliveries typically take around 3.5 days, and delays can’t be avoided completely.
  • Fraud susceptibility. In 2021, paper checks were the payment method targeted by fraudsters the most.
  • On-premise processing. Nowadays, processing payments remotely is critical to the efficient functioning and growth of businesses.

As you can see, there are plenty of disadvantages related to the manual processing of B2B payments. But can digitization address them?

The Benefits of Digitizing B2B Transactions

Is B2B Payments’ Digitization the Next Trend?

With a drastic shift toward remote work due to the COVID-19 pandemic, businesses have faced the reality in which their employees need to manage the incoming and outgoing payments outside of the office.

Thus, it’s crucial to digitize some critical B2B payment processes within the organizations, such as:

  • Accounts payable
  • Accounts receivable
  • Expense reimbursement
  • Employee-initiated spending

Making the above tasks less manual brings plenty of benefits to businesses, such as:

  • Transparency in the movement of funds
  • Optimized cash flow
  • Lower risk of payment-related fraud
  • More control over the transactions
  • Reduced errors
  • Less time needed to be dedicated to monotonous tasks

Yet another decisive factor in favor of B2B payments’ digitization is that this shift cuts the costs businesses face in the long term.

Reducing the use of paper checks by 10% leads to $1.3 billion in annual savings. If the company manages to decrease the use of traditional checks by 50%, it’s likely to save approximately $58.3 billion every year.

With that said, it’s safe to assume that the shift toward global B2B non-cash payments is inevitable. It’s estimated that there will be around 200 billion of such transactions by 2025, as opposed to 121.5 billion in 2020.

B2B Payments’ Digitization in 2022 and Beyond

Is B2B Payments’ Digitization the Next Trend?

At this point, it’s evident that the transitioning from paper-based B2B payments to their digital counterparts should become one of the top priorities for businesses of all scales.

Some great alternatives include:

  • EFT and ACH. Electronic Funds Transfers help send money digitally from one bank to another while requiring zero direct participation of the bank staff. Automated Clearing House payments are a type of EFTs available in the US and run by the National Automated Clearing House Association (NACHA).
  • Credit and debit cards. Even though card transactions can be more expensive compared to ACH payments, their popularity in B2B financial operations is increasing due to almost instant processing times.
  • Virtual cards. These are temporary cards that can be used online and are tied to a permanent bank account. Virtual cards provide extra security since the details of the main card aren’t being used and thus cannot leak in a potential data breach.
  • Digital wallets. E-wallets are online applications that enable users to securely store their payment information and are very convenient to use for both individual and business purposes.
Ultimately, increased efficiency, reduced costs, and advanced security will be the main factors driving this trend and bringing some fintech providers ahead of their competition.

Payneteasy is today's leading payment platform provider that combines all of those aspects alongside additional benefits, such as tailored solutions, fast integration, straightforward functioning, and thorough technical support all the way. Reach out to us now to start digitizing your B2B transactions now or if you have any other project in mind!

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